Skip to main content

tv   Tonight From Washington  CSPAN  January 8, 2010 8:00pm-11:00pm EST

8:00 pm
this tremendously important and important trip and as soon as he gets back we will see if he is willing to come back here and share his observations with you. thank you very much. >> thank you ..
8:01 pm
one it's about one hour and 45 minutes. >> if i can ask you to find some seats, which may be easier for me to say than for you to do. i usually can point to a bunch of mt see the front but by golly there are only a couple of them. we appreciate your patience. we tried to accommodate as many people as we could topics and powerful speakers, and a very timely occasion so we will do the best we can, and i ask your indulgence. i want to welcome you. my name is ed howard, with the
8:02 pm
alliance for health reform, and on behalf of senator susan collins and senator jay rockefeller, and members of our leadership, i welcome you to this program to examine the parts of the senate and the house reform bill, health reform bills that would set up a health insurance exchange were set of exchanges to improve the way individual in a small group insurance markets function. a lot of different models for exchanges and they can defer her pretty widely from each other. everything from simply farmers' market style website that allows better grasp of the available options to an exclusive highly regulatory animal that except some control over who can buy what and at what price. fortunately for purposes of our
8:03 pm
looking at this issue exchanges do indeed exist in nature. post governor related and privately run, and we are going to hear today from folks who have been running some of those successful exchanges, and we will hear some about exchanges that haven't been quite so successful, and of course we will look at the exchange provisions of both the house and senate a lot of which look pretty similar but there are noteworthy differences and we will get those as well. my colleague and co moderator, sara collins at the commonwealth fund will be helping us from our discussion by fleeing out very broadly what is in the bill and what issues need to be addressed in reconciling the two versions which is a new segue to the fact that our partner and co-sponsor in this briefings the commonwealth fund which has both commissioned and has done some
8:04 pm
very excellent analysis of this issue. the exchange proposals and the bills and the idea of an exchange itself. we turn to the aforementioned sarah collins. she's vice president of the affordable health program at commonwealth and co moderator of today's program. she's an economist and the main author of the papers that you have analyzing the provisions of those prospective reform bills that were available as handouts. sara? >> thank you, and good afternoon. as ed mengin i'm going to briefly laid out the broad provisions of the house and senate bills and look at where people in particular are estimated to gain coverage under the bills. in particular the number of people covered through the exchange's and then discuss why we need an insurance exchange and the type of reform bills
8:05 pm
that are before congress and with the key issues or in terms of structure and implementation as we move forward. everyone knows by now the broad outlines in the bill both aim for near universal health inch parents coverage by building on what are the strongest aspects of the health insurance system and a large employer based coverage, medicaid, children's health insurance program and by regulating and reorganizing the individual and small group insurance markets which are arguably the weakest part of the current system each bill would bring sweeping change to those markets which are previously fallen nearly exclusively under the regulatory previous dates by establishing new federal rules requiring insurance carriers to accept everyone who applies prohibit rating based on health status and implement age bins. the bills would create a new health insurance exchange operated either of the national or state level for individuals and businesses to purchase health insurance coverage, sliding scale premium subsidies
8:06 pm
and cost sharing subsidies would improve affordability and reduce under insurance and in some standard benefit package with different levels of cost sharing but set a floor for plans offered through the exchange income eligibility for medicaid come increased 133% or 153% of poverty among large employers required to offer coverage or contribute to the cost and everyone or nearly everyone would be required to have health insurance coverage. in terms of where people would gain are estimated gain coverage of the bills these are estimates from the congressional budget office impleader based coverage would remain the predominant source of coverage covering about 160 to 170 million people under the bills. the exchanges are estimated to provide a new source of coverage to 30 million people either individuals or employees of small companies. small to mid-sized companies purchasing coverage through the exchange would bring about five to 9 million people into the exchange from so about
8:07 pm
30 million covered under the exchanges in both bills. coverage through the medicaid program rises was expected to rise from 35 to 50 million people uninsured estimated tolld in 2019 to 18 million under the house bill in 23 million under the senate bill. so what is the purpose of an insurance exchange and context of broad based health reform proposed in the bills that builds on the existing health insurance system? the individual in a small group insurance markets are poorly organized right now. there are substantial barriers to obtaining coverage, market rules and consumer protections, vary widely across states, plans are difficult for people to understand large percentage of premium dollars goes to administrative costs. there's lack of economies scale and market competition is based on avoiding risk rather than enhancing value, some exchanges can be designed to provide
8:08 pm
structure and oversight to insurance markets with goals of improving consumer protections and enhancing the transparency of the benefit packages, lowering premium growth, reducing health care costs and changing the competition dynamic from frisk to value. the key provisions of the exchange in terms of their viability over time and ability to provide comprehensive coverage costs include strong market reforms both inside and outside exchanges, brought risk pooling in the individual requirement to have coverage. but the standards to ensure comprehensive coverage and informed choice come sliding steel premium and cost sharing subsidies should only be available through the health insurance exchanges, the authority of the exchange to negotiate premium source of rules and participation for health plans, excuse me to negotiate premiums, a choice of high value plans.
8:09 pm
tim jost is going to provide much more similarities and differences between the bills on the exchanges as he does in his excellent paper that included in your packet today so i'm going to skip the slide and leave that discussion for tama and get to what i view as the key issues regarding the structure and implementation of exchanges as we move forward. those include federal versus state operation or control of exchange, exclusivity of the exchange, and by that i mean whether the exchange becomes the whole market or if if the individual and or the small group markets are allowed to exist outside of the exchange. the extent to which the exchange has authority to negotiate premiums and set rules of participation and whether the rules for participation are aimed at encouraging plan, innovation and value in health plan design. finally whether the exchange will have the ability long-term to the risk of just so the competition between the plans
8:10 pm
focus on value and not frisked. thank you. >> thank you. before we move to our panel let me just do a little housekeeping here. in your packet you are going to fight a lot of good background material including speaker biography information much more extensive than we will have time to give them orally and you will find the powerpoint presentations you may find hard to leave on the screen in your pockets as well. if you are watching on c-span and have access to computer you can find copies of everything the folks here have in their kit on their website which is www.allhealth.org. for the record we didn't get a letter from c-span asking us to open this briefing to the cameras. we volunteered it. [laughter] there is a webcast and podcast
8:11 pm
available probably monday at the website kaisernetwork.org. i'm sorry, kff.org. about to change that. which stands for kaiser family foundation. kff.org very much to the folks who make that possible. duals find copies of the material there as well as at our website. and in a few days you will find on our site a transcript of today's session, which a lot of people find useful in reviewing things very quickly. at the appropriate time we have question cards in your materials, green cards you can use to write a question and have it answered by a court panelists that are also some microphones that you can use at the appropriate time and folding the program i would appreciate if you would fill out and leave
8:12 pm
with us the blue evaluation forms in your package. now let's get to the program. i have a knowledgeable group of experts and analysts today. a broad range of experience. we are going to hear brief presentations and and have lots of time. let's start. leading off today is timothy jost from the abortion and ten law faculty and he's the author as cyrano did the and exchange papers that provides the jump in off point for the discussion today. tim has written several books on health policy topics not to mention his co-author the leading casebook on health law we called catching the enough, "patch law," in its sixth edition. if you agree on this subject or not you are going to find compelling, coach and and accessible for a lawyer or
8:13 pm
anybody else. tim, thanks for being with us. we look forward to having the conversation. >> thank you very much. i must say as an aging law professor, the powerpoint is still something i am not very comfortable with, so i will do my best to move my slides along but he might also listen to what i have to say. if there's anything we can predict with almost absolute certainty about the health reform legislation that will emerge from congressional again negotiations in the next month is that that the legislation would include a health insurance exchange. the health insurance exchanges quite simply an organized market for the purchase of health insurance. the exchange's most familiar for the massachusetts connector represented by mr. kingsdale and federal employees health benefit program. the medicare advantage program, medicare part b program, health care systems of switzerland or the netherlands arguably also germany contain many of the elements of the exchange.
8:14 pm
the health alliances are not which the clinton health plan wailled or exchanges. as were in our state based and private purchasing cooperatives which have been tried repeatedly and sometimes with success over the past two decades. the connecticut business industry association represented here today by mr. vogel represents a successful private purchasing cooperative. the of course will each model can be called an exchange they are in fact quite different. indeed the models represented by the house and senate bills are different in very significant ways. the focus of my paper and of my brief presentation this morning is on how the house and senate bills differ and on which model is most likely to result in the exchange the serbs' best the goals that an exchange is intended to fulfill. first, quickly let me ask you the question why do we need an exchange, what do we expect an exchange to accomplish.
8:15 pm
the exchange is intended to play a number of rules and health care reform. and sara briefly went over this but let me go for it again. first, it is expected to be the locust onagement competition of insurance plans. it is hoped that the exchange will focus competition on price and quality rather than of risk avoidance and will thus make health insurance more accessibl. second, the exchange is expected to create a sizable risk pool that will together with the insurance reforms found elsewhere in the bill allowing insurance risks to be a more efficiently managed reducing the incidence of adverse selection by insurance and the practice of risk selection by insurers. third, it is hoped the exchange will reduce administrative cost by simplifying marketing and premium collecting and by eliminating risk-based underwriting and simplify the
8:16 pm
packages that insurance companies put together for insurance as well. fourth, the exchange offers the possibility of making health insurance markets more transparent and facilitating consumer choice among health insurance plans by standardizing plan offerings and providing more and better information about health insurance options. fifth, the exchange may play a regulatory role helping to make insurance more accountable, in particular it could serve as a forum for reallocating risk among insurers and for guaranteeing that those who sell comprehensive health insurance coverage, that those insurers sell comprehensive health insurance coverage with manageable cost sharing and that they market their plans fairly, they respond properly to consumer claims and complaints as well. sixth, the exchange will likely play a role in facilitating other key features of the health care reform legislation such as payment of premium credits or
8:17 pm
even perhaps the imposition of the individual or employer mandates. in many respects the house and senate bill provisions governing exchanges are quite similar. both the house and senate bills for example permit individuals and the non-group market and employees of small employers to purchase health insurance through the exchange. both require health plans offered through the exchange offer standardized the essential benefit packages that are arranged by tears, basically based on cost sharing or actuarial value to facilitate consumer choice. both bills contain an extensive range of transparency and disclosure requirements to facilitate choice and improved insure accountability. both provide premium subsidies which will cover over half of uninsured individuals and then on a group market and only available through the exchange.
8:18 pm
both of the exchange some discretion over whether or not to offer health plans and thus some bargaining power with insurers. both bills generally held long risk underwriting by insurers and pre-existing condition exclusions and both contain a program for reallocating first insurers. although the programs in the two different plans for the risk dilatation are different. both finally allow grand father plans to exist outside the exchange which will undermine its ability to pull a risk. the bills, however, differ in key respects. which approach is in the end taken will have a profound influence on the implementation and effectiveness? first, the house bills put responsibility for creating exchanges on the national government. the house bill creates a national exchange but allows states that can create effective alternative exchanges like massachusetts to opt out.
8:19 pm
the senate bill on the other hand places the responsibility for forming exchanges on the states. it depends on each of the legisn that will mirror the federal legislation in terms of the insurance reforms and in terms of creating exchanges, and then to proceed to create each state its own exchange were substantive exchanges. if a state declines the invitation to do so, or if the department of health and human services determines a state is failed to do so hhs can set up in exchange in the state or contract with a nonprofit organization to do so. this will depend on the federal government effectively determining a state has failed to comply with the law and stepping in after the fact. the state exchanges are also and should be noted an unfunded mandate. there's no federal money in the legislation for the states to implement these exchanges. they are going to have to pay for them themselves presumably
8:20 pm
by taxes that will be imposed on insurers. the bill provides only startup expect t to be selfnges and supporting once they are under way. state based changes have in fact certain advantages including perhaps better knowledge of local insurance markets and regulatory environments. but national markets offer larger risk pools and greater efficiency. you don't have to set up 50 exchanges each with its own programs, each with its own capacity to do the functions exchange will do. you could have one program. the federal government already has extensive experience with running exchange with programs like the fe hbp, medicare and vantage program, medicare part b prescription drug program. but a letter to programs include in fact risk adjustment programs which will probably be part of the exchange or at least part of
8:21 pm
the insurance regulation system. most importantly, and national program promises uniform implementation of the exchange. if some states want to go beyond the federal program, the house bill allows them to do that. but it does mean no state will be allowed to lag behind, no state will be allowed to simply refuse to set up an exchange and then have the federal government stepped in belatedly and try to clean up the mess. the second biggest difference between the house and senate bill is the exclusivity ofchang. the house bill requires all non-group health insurance coverage other than grandfathered coverage to be sold through the exchange. the senate bill allows a nonverbal market to exist outside the exchange and does not rre policies sold outside of the exchange to meet all of the requirements that must be met by qualified plans
8:22 pm
that are sold through the exchange. this leaves the door i believe wide open to adverse selection by enrollees and risk selection by insurers against the exchange. both bills also allowed a small group market to exist outside of the exchange which i think to some extent threatens the same difficulty. the senate bill partially compensates for its open market by requiring insurers to require all insurance in and out of the exchange in the same risk pool, and requires issuers of qualified health plans to charge the same premiums in and out of the exchange for the same plan by requiring insurers all side of the exchange to cover the same ease social benefits and the same tiers of the actuarial value and finally the senate operates its risk reallocation program within sight and not hide the exchange. but the senate bill i believe leaves the door open for insurers to decide to stay completely out of the exchange
8:23 pm
to set up plans configured to attract the best risks away from the exchange and leave the exchange with more expensive high risk groups thus the senate to bill will also require a greater amount of regulatory oversight because it will require the states, not the exchange but the state's to collect enough data on plants inside and outside the exchange said it can risk of just between plants in and out. it seems to me is far easier simply to require all insurance imam group market to be sold through the exchange. a third difference involves the authority of the exchange with respect to health plans. in particular, does the exchange merely offer whatever plans insurers make available or does it have regulatory authority as well? both the house and senate bills contemplate exchange with some regulatory authority.
8:24 pm
making them disclose certain formation or participate in the risk adjustment program for example. the house bill goes further, however and contemplates the exchange of receiving bids from the insurers and negotiating the terms of the plans with the insurers. will the terms of these negotiations are not specified, the legislative language leaves room and opened for example for the exchanged to negotiate issues like premiums, medical loss ratio is, administrative cost etc.. the manager's amendment to the senate bill on the other hand also allows the exchange to take excessive premium increases into account and certify plans and in fact requires that the exchange certify plans as general language like being in the best interest of the insurer's. so i believe the senate bill leaves some discretion for the exchange particularly after the
8:25 pm
manager's amendment to negotiate plans with respect to issues like premiums. there are other differences between the bills we can address in questions. the house bill stila includes a public plan may be for another few hours to be offered through the exchange. the senate bill of course includes these multistate plans that are offered through opm and so the senate bill balears one exchange on others which can lead to interesting dynamics. the senate bill bars undocumented workers from purchasing insurance through the exchange. the house bill only bars them from receiving premium subsidies. the senate bill has stronger transparency and disclosure requirements. i believe that transparency and disclosure requirements in the senate bill are exceptionally good and requires the exchange to rate health plans which is not in an in-house build. the senate requires qualified health plans to provide quality
8:26 pm
assurance programs which the senate bill does not. neither bill, and i don't know how much opportunity there is to slip in anything at the last minute but neither bill addresses the question of privacy of health data in the hands of the exchange and under the current statute and regulations i don't see that the exchanges are automatically covered. so it seems to me that is a simple fix that perhaps could require some attention. a key point, however, is also the exchange holds great promise as a health policy tool, we also have a history of pretty disappointing experience with exchanges. we are going to hear today abouh exchange. but a number of states have tried exchanges that failed. we have a chance to get it right with this legislation. to come up with a powerful tool for improving access, controlling cost perhaps even improving the quality of health insurance and health care. it's important, chris gets it
8:27 pm
right and i thank the commonwealth fund and alliance for sponsoring this meeting today to allow us to talk about that. thank you. >> thank you. by the way, in tim's fever there is an executive summary up front and text in the back and a bridge between them is one of the neatest the charts you are ever going to see that summarizes the differences and similarities of the two bills and i commend that to you. >> turning to john kingsdale -- [inaudible] thank you. john is the executive director of the biggest real world pilot of a real world insurance exchange this side of th federal employee plan. that would be the commonwealth health insurance connector authority set up by the massachusetts landmark reform law from 2006. john worked more private insura.
8:28 pm
he taught at the harvard school of public health and he even did a report for the forbes magazine rino for answers during the debate as you try to shape this language not just on the exchange but on related topics. john, welcome back. glad to have you. >> that was a very helpful introduction from sara and tim on the basics. i don't know how much further i'm going to go so in case i lose you and it's easy to do in insurance, and i have been in since the civil war and i usually lose myself. the take away here is utility. there is more we don't know than we do know about how the house and senate versions vision would play of. i am so pleased fill vogel is here. he runs an exchange in connecticut which both of ours are state exchanges and we couldn't be more different. his is basically small employers and ours is for individuals just
8:29 pm
to give you one example so when you've seen the house version or senate version you see one out of 1,000 that may play out. that said, let me try to shed a local white. i start from the premise that this is perhaps the most challenging domestic implementation of a domestic policy initiative at least in this century that is easy. that is only ten years. but i would go back maybe another century. it's personal, complicated, it's partisan to say the least, and then of course cost country which is far more ambitious than we were in massachusetts. we tested acid expansions three we are actually fees to working on the cost control because that means taking money away. always a popular activity. that's even harder and so the house and senate and administration are being congratulated for taking on the two toughest issues in american politics i think at once.
8:30 pm
and as has been noted most have failed so i feel a little like the 14th century or 15th century european map makers describing in cockney go and i have a personal bias that implementation as 90% of the game. there's a lot of folks here focus on the act by believe it lives or dies based on implementation a lot of the melody. i would start with saying the way to improve the odds that an exchange of any sort will work is to define realistically a very limited set of objectives, and i won't go into the details but when i hear the objectives set forth in policy papers that run to the half-dozen or does and objectives for exchanges of i shudder. acknowledge, simply and compensate for the weaknesses of each bill. they each have weaknesses i will get into and then we try to
8:31 pm
reinforce them for whatever exchange we come up with adequately for implementation. most of what an exchange operator will have to encounter has not even been thought of. it will depend on the circumstances as they evolve under a whole new set of realities. realistic objectives. i think there are maybe three that are partly doable. one is to reduce administrative costs of buying insurance. there is tremendous waste if you will or cost and the distribution of insurance particularly in the monitor and the small group and of insurance, and that's clearly a target that we ought to be able to improve. second, to improve consumers' shopping experience, and particularly in the small group and into thearket. just by way of illustrating this i actually to this day four years after we started to get up and running got stopped and
8:32 pm
think on the street by people who use the health connector of massachusetts to buy insurance themselves or for their 22-year-old kid because instead of spending half the morning trying on the telephone to compare force its insurance policies from four different carriers and then coming away with a bunch of scribbled notes that can go on the website and typically in 20 to 30 minutes compared reasonably comparable products, push a button and get enrolled. i wouldn't underestimate the importance for success and implementation of a massive health reform just being able to serve your customers will. and then finally having some price resistance to the premium setters, and i used to be one on the health plan. most of the costs they are trying to price for they don't control and they are generated by doctors, hospitals, pharmaceutical companies, etc.. and through a big negotiation and managed competition choice, you may be able to, we may be able to add a little price resistance in a little more fortitude on the part of the
8:33 pm
negotiators and take down as administrative efficiency as well. so those are three fairly modest goals. now, how to improve the work with what we have on the table in front of us. i would say there are some weaknesses in both bills. first of all, industry resistance. you don't -- to get very basic, an exchange is an automated store for insurance. you don't run a store if you don't have any products, and there is typically no way to compel a producer to sell through you even if you require it unless you close off all other stores. they are good about finding the store they want to sell through. one thing would be resistance to exchange. and this will -- you can deal with it through making exclusive channel and that is one way. certainly that is practical for noncorporate that is in practical in this country for
8:34 pm
group insurance, small or large. make additional segments evolutionary. see if the exchange is working and can build on its track record, can in fact invite participation both customers and producers and then provide flexibility particularly when you get beyond the norm group market. the small groups are a local market. it's different in connecticut and massachusetts not to speak of mississippi or alaska and there are provisions in the house bill i'm pretty convinced will end up having absolutely zero small employers use the national exchange. we can talk about that if you want. secondly, adverse selection is a major issue. this is a whole complexit comes options, new rules, all of these encourage adverse selection. it's the easiest way to make the bottom line as a carrier be positive. one way to counter that would be again exclusive channel for the
8:35 pm
mog group and risk adjusting within that. a second way is certainly claims based risk adjustment but it has to be across the entire market segment, so if you are risk adjusting for a small group you can just do it in the exchange, you have to do it across the entire market and then finally, coming back to the point about options frankly forgoing the large group market if it is an option for large groups and they can do choice themselves, the only large employers are likely to get into the exchange of the once somebody else wants to dump their. and third, cost controls, big for plan, that is critical. the house is clear on that. i think they are pretty much there. standardizing benefits over time, and this comes back to the fact we are stores for health insurance costs of massachusetts for example over three years the connector has come to standardized benefits but in 2007 when we started we didn't
8:36 pm
know which benefits would sell or which were preferred so we had to evolve over time to standardize benefits. and then automate, automate. there is a truly tremendous amount of administrative efficiencies to begin. now, turning to the house legislation for a minute. i think one of the problems, and tim and referred to it is what i call market isi think that is only one of several reasons there's likely to be zero. i say zero small group participation in the national exchange as envisioned. another wan -- another reason is all the premiums are supposed to flow directly from employers to carriers and so having a model where joe's gas station with five employees has to get built and paid to fight for carriers to offer a choice to his employees is pretty much a nonstarter. so i would suggest maybe focusing with the strengths of that exchange which is in on group market, far less complex, less nuanced and geographic
8:37 pm
portability is critical. most small businesses don't change states. delegate and decentralize where possible. it's clearly hampered by the focus on a washington-based or national management structure, and then finally emphasize the customer experience. again, this is where policy its reality. this is where the backlash will be very real and tangible for that god awful big monster created in washington and it doesn't actually get me insurance when i go on line. secondly, there's a whole issue about regulation versus retailing. clearly, the national -- the house vision is one for an exchange to be more of a regulator than the senate suggests here. maybe that can be done but there's got to be limited set of goals, a considerable amount of independence for the agency that administers this to the health choice administration to figure out what works, to try different things, not to be
8:38 pm
by a board of directors made up of 435 representatives and senators. i suggest minimizing the policing role of you want to actually sell insurance, which is basically the mission of an exchange. nobody buys it if you haven't done anything. you are going to have to be somewhat less of a policeman and maybe that means regulating carriers more through state divisions of insurance than national exchange which is trying to regulate the producer of the product while it sells the product. and then finally, i think customer experience as i diluted to before is potentially a weakness and the house version and their flexibility phasing in and not prescribing every element of transparency encouraging pilots would be very helpful. turning to the senate i think there are a number of problems and i'm going to add a fourth one. scale economies is clearly one.
8:39 pm
they will be much more skilled, and as a web based electronics store the fixed costs are pretty substantial and the scale is critical to administrative efficiency and national is a definition bigger than state-by-state but you can make that the exclusive channels for the lawn group and that is worth about in massachusetts that would be subsidized and tons of supplies to be 3,000 people and at that point even a modest state exchange has gotten 90% of the scale economies we can get out of the volume. as a 300,000 is a pretty good -- at that point you are not getting much increment savings from growth. developing national utility functions, national web based tool the state exchanges can use. second, geographic portability. particularly the non-group market people move and split their time between states etc. but the key here is to have national plans, not in national store. as long as you can buy national plans that's the key, and that
8:40 pm
could be supplemented by reciprocal arrangements among regional plans and by federal standards of interoperability among state based exchanges. consistent performance clearly inconsistency performance is a problem and there's some conventional wisdom things noted on the powerpoint. but finally, i would add dependence on state interest, energy, support and resources is somewhat of an achilles' heel. there is a provision for the fed to step in but given the controversy alladi that has come to characterize this entire reform effort there is a realistic prospect some states will do everything they can to actually make this field to be perfectly blunt and depending on them to run the exchange it could be problematic. and then finally i would turn to the last point about resource and involving exchanges. we are entering into a period that passes may be at least a
8:41 pm
decade legislating, trying, figuring this out, so some degree of independence for exchanges to figure out what works, focusing their funding. i like the senate version much better that has funding tied to sales, a surcharge on the premiums you -- the transaction is actually happening with the exchange. i think that focuses the exchange probably on its most core mission to get a whole bunch of people insured. second, clear objectives but flexible means. we just don't know. there's so much more we don't know than what we do know about how these are going to work. try as i said to electronic transactions and audit trails. there is a huge wash of billions of dollars annually envisioned in the exchanges and a very murky set of auditing instructions come and then finally a rigorous evaluation so i hope that is helpful. thank you.
8:42 pm
>> thank you, john. the final speaker is philip vogel, senior vice president at cbs iowa service corporation, a division of the connecticut business industry association's cbia. he's in his third decade of the sara and the service corporation offers health insurance among other things to the thousands of members of cbia. he also spent a dozen years in the private insurance business to ackley . he's been a certified life underwriter for more than 30 years and his division has led the way setting of a statewide health insurance purchasing alliance that allows workers in the small business members of cbia to choose among several different companies and policies so we are anxious to hear you have had and the success you have had. thank you for joining. >> i think you have heard a lot of good ideas from the panelists
8:43 pm
and from -- and probably going to repeat some of the pointer to take you into the private sector little bit. as we've operated at one point it was called hippa because we designed in the clinton your underwear model thinking you could sit out an exchange and people would make decisions based on price, network, satisfaction, quality data and that is we try to do when we introduced our program. i'm going to repeat some of the things set up here because i did there's a lot of very good things said but what i'm going to try to do is give you a view into the private sector and into an exchange that's been running for over 15 years. it is as i said cbia is not for profit. we run out of a nonprofit cbia subsidiary court. we pay our taxes for any services we pay, that we
8:44 pm
provide. and basically, coming from a state that is very high in sure we'll have an insured around 10% or so, we have a very high mandates. we have a lot of other practices in place, yet we are able to compete in the private sector. nobody has to come and buy for less. this is totally voluntary of the businesses were to come to the exchange and by through loss so we look at a very competitive marketplace and how we work so what i would like to do is take you through that is what we are and what we are successful and i need to give you background in connecticut of the rating rules that we operate under because those allow the rules we talk about federal we in both the house and senate bills. what we do and maybe some of the lessons we've learned over time and some of the opportunities. we reduced program to america 1995. it is an employee choice model. what does that mean?
8:45 pm
it means we have for health plans to contract with. each employee can choose from that, one of those for health plans and a whole wide range of benefits from benefit levels from those companies. we have over 5,000 companies over 75,000 members in connecticut that participate. one of the things we talked about so far and one of the things john emphasized and tim is looking at the adverse selection. one of the hallmarks when we first started was we stopped to be to try to standardize the benefits between the four health plans so to avoid adverse selection. as we've come very close to having standardized bens healths starting day one in 1995. as i said, we tried to determine and said the spread out under managed competition choices based on price, network as things involved people make now decisions based on the formularies of the different
8:46 pm
networks and the satisfaction rates. unfortunately over time we still have an object when we first started of having quality data, patience and individuals could make decisions on and the data is still not available with this point in time. so why did we think we have been successful? first, we think we brought in poppy-free choice to the marketplace for employees and employers. but one of the things we know is the employee's trust their employers and about to buy their insurance through their employer and they trust them that we have to make sure we add value to the marketplace to each individual, to each company, to each of the insurer's so that the entire market is getting a win win and that is how we try to manage the program throughout. there's been an evolution as we looked through our program of where we started it we tried to set out specific rules but we have had to change dramatically
8:47 pm
over the last 15 plus years we've been doing this. as john mentioned, health insurance is very, very personal. it touches each individual. it touches their families, and each situation is different and unique to try to figure out how you can attract and are marketed to those individuals and satisfy their specific needs. we stayed true to our mission the entire time that only focused on small business. we didn't get distracted and go to the large business into the lawn group business was a true to keeping our objectives as john said keep the objective straightforward and make sure you concentrate on those objectives and not get distracted. now from the private sector, and for some way to be biased coming from the private sector side from our standpoint innovation is absolutely the key. you have to be able to set out
8:48 pm
to be able to change and adapt. when we started this week how your employees so that we could administer our program, and i said two things to those employers when we hired them. number one, i guarantee to things, i guarantee change and i guarantee that we forgot something and that was the only two things they were told when we first started. and that has come true because we changed dramatically over the times and they have to have the ability -- we have to have ability to change as we go forward. the selection issues as i said, adverse selection is right and when you're competing in the outside market it is absolutely critical the adverse selection is avoided and i'm going to talk about the background into slides as we go forward. what we do -- what we do from a the cbia standpoint is look like one large employer to the health plan but we do everything.
8:49 pm
and i have to say one of the differences from our exchange is we are the exchange in the sense that we designed the program and negotiated contracts for the health plans etc. but we are also the administrators we are actually doing of the day-to-day operations in the sense that we will do all of the proposing with the reit would be and the benefits if a company is looking for a quote we will actually sell it, and laurel, hold meetings if need be, handle any of the billing problems we send an eligibility to the plans on a daily basis, collect premium, remit premiums. there's one simple bill that goes out to the employer so we are trying to provide everything needed that needs to be taken place through all of the communications to all the different segments we are serving. so we do differ from that standpoint. what have we learned? well, we learned number one --
8:50 pm
actually i think i ask the slide that was critical. let me come back to this slight connecticutnd, that is the rate kleypas small case reform laws in connecticut in the early 90's and what that did gav community rating so there was no decisions that could be made based on claims. no right to ban or not things we have adjusted community rating, guaranteed issue,y. we do have some rating factors being the age, the area, dependent status etc that can change some of the rates and a reinsurance will behind-the-scenes. but this is -- this piece is important and also helps adverse selection so the marketplace is not trying to make decisions based on risk and that is what john and timothy talked about as very important. so, that as a backdrop that has
8:51 pm
been three important for us and it is a lot of things included in both the federal bills, the house and senate. so, some of the lessons as we move forward. i talked about a little about the adverse selection we tried to avoid adverse selection from day one. one of the problems is if you are simply looking for administrative expenses and just to save the administrative expenses we have a real problem because even in the bills they talk about in the group marketplace they're looking for 85% loss ratio, yvette dusable but there you are not hitting the 80 or 85% which is the claims dollar and that is what you have to look at and figure out how can we change the risk profile underneath to help look
8:52 pm
at the claims site? i have a real problem with putting the loss ratios in their only because it stifles innovation. it stifles the ability of companies to invest in what they would do to help manage the care and consult on the care or drive down some of the claim costs we are talking about. i can comment later on some of the broker compensation very insist we haven't allowed any in our program whatsoever, and we also look to make sure we are consistent with what the market does outside of the exchange. some of the things to think about. well, there are unintended consequences and the is the unintended consequences of the time for what may take place if we make certain decisions. some of the -- i think some of the age pieces, the house has a 2-1 rate been on pricing. the senate is talking 3-1. that can be a problem unless
8:53 pm
there are strong individual mandates because of the individual -- if individuals were smart businesses start to drop out of the marketplace is the one will drop out of there isn't a mandate or the health risks and we will end up with a high risk pool, high rates, higher health situations and i will leave us in a major problem. there are going to be problems in trying to figure out the subsidies and win hukill multiple funding sources and where the dollars are coming from and how to handle part-time employees etc., those will be situations. the whole risk adjustment premium redistribution becomes an issue because now if you are a redistricting premiums it becomes tricky because you may need redistricting premiums to a carrier that is not as efficient or working on the risk like they should be and they are hoping that reduce their price. and i focus on wellness and
8:54 pm
behavior change and that is a big piece john and i were talking about prior to us coming up here. but i think the culture as we move forward, we have to look at this how we bring something to the small business and mullen group market at large markets are doing today? they are trying to figure out how to make a healthier population, how to invest and reduce risk within the population. it's very, very difficult. we have companies in connecticut we talked to all the time that are doing this. the large companies, trendlines flattened. if we don't bring that into the small business marketplace and the mullen group we will just exacerbate and continue the problem. i have got a couple of questions for you and i guess i want a show of hands but they are touchy questions. i would expect everybody in here
8:55 pm
pretty much knows if i said how many of you know how much you weigh probably most of you would say okay, i know that. the question is how many of you know your numbers and the numbers have many of you know your blood pressure, how many of you would know your cholesterol, how many would know your glucose and your bmi, body weight index, so the question is as we go forward we can't just look at administrative expenses and just say the exchange will only reduce expenses. it needs to do more than that. it needs to move forward into how we actually change the overall -- underlining population, the health of the population of people have multiple risk factors how we did that to reduce to the one risk factor and i think we have to look at that as we move forward and it's something i am not hearing much about and it's important as we go forward. >> thank you. now you have a chance to join the conversation.
8:56 pm
as i said, you can repair to one of the microphones, you can fill out a green card, and let me take the occasion while we are waiting for the audience to do either or both of those things to invite any of the panelists who would like to make additional comments or response is to do that now and we have tim jost. >> three quick comments. one, i agree with jon, the small business part of the exchange in both of the house and the senate is problematic as to how that is going to work. and other than the obvious things like the size of the groups to participate when you start getting into the details of how is this going to work it gets very complicated. and in particular the senate bill seems to be poorly flashed out. the problem john specifically identified of the premiums being paid to the company rather than through the exchange as an artifact of the budget process
8:57 pm
cbo put out a memorandum in the spring as to how it was going to score health care reforms and one of the things it said is that if the premiums are paid through the exchange's that becomes revenues and expenditures in the federal government which means any moneu know of a sudden the cost of health care reform is gone up dramatically, and i assure congress a just didn't want to go there. but it is going to be very problematic particularly because every individual as i understand it in both the house and senate is going to be individually underwritten with the factors that remain which means a small business is going to be paying additional premium for every one of its employees based on age or the other fact, tobacco use, the other factors that are included so just to respond to that i agree that is a real problem that is why the problem is there to get sick and with respect to the medical loss ratios under
8:58 pm
the house bill, and i believe it is true under the senate bill as well medical loss ratios are defined to exclude the costs of improving quality-of-care, so i think things like a disease management programs and private care programs and so far has invested in those would not be considered to be part of their administrative cost. so i think there is room there for flexibility and innovation. and if ordered, with respect to how wellness incentives, the senate bill in fact includes a number of provisions for to encourage plans participating for the exchange to provide various kind of the incentives including wellness and prevention programs and also one of the things added by i think it was added by the manager's amendment to the senate bill was provision for funding of small businesses to provide wellness programs like larger businesses and increasingly have. so one of the problems that i have and i think a lot of us have is focusing excessive lead
8:59 pm
on title i and for getting the other eight titles of the bill, but there is a lot on prevention and wellness and that the back of the bill some of which is going to help out small businesses, so i just wanted to a tactful to critique the point out those things and thank the institutions and people i talk to donner during the speeches, one of the participants as a comments. jon? >> [inaudible] >> dee dee to -- about the running exchange on the federal budget. it actually happened -- i've been reading -- i got it on my way down this morning because it is a critical piece of technological -- of technicality that i wouldn't answer we see 6i no position to dispute. my point is only if that is the controlling consideration i do not believe that there will be any small your enrollment and there are a whole lot of senators and congressmen who look to the exchange to be a bit
9:00 pm
of a panacea for small groups, small employers suffering horribly with increases and it's a problem. i actually would read this by the way as suggesting -- as clearly indicating that under the senate version we are -- where states are given the option to run caminhas prepare exchange or not, and where there is a broad range of benefits that are qualified health plans down to 60% at a real value that under that construction the premiums, the private-sector premiums would not be on budget. they would be -- they would be the revenues offset by the expense only the net would be on budget. .. that says even though expenditures are run through the state's, if they are
9:01 pm
administering the program under federal direction the states may be considered as agents for the federal government. i am not sure the senate can avoid this, but i think you are right that they will probably have an easier time avoiding it running it through the states. i would >> cbo runs a lo things. [laughter] >> i've picked that up this year. question yes, we have folks at the microphone. let me ask you to identify yourself and ask anyone that stands up and ask a question, be as brief as you can, so we can get to as many questions as we can. >> al, how do the changes affect the public and private funding for abortion coverage? >> under the -- under the senate bill exchanges have to,ic,
9:02 pm
provide at least one plan that does not cover abortion. beyond that, and under the senate bill -- under the house bill, that was one that didn't and one that did. i think that came out in the stupak amendment. beyond that, i think the rules for abortion are the rules for abortion. and the exchanges aren't very much involved in them. >> the only comment i'd add on that, and again this is a perspective a retailer if you will, the requirement to resolve this fundamental moral issue that the store packed two pickups for every one real and put twice -- go into a supermarket. the most critical resource is shelf space.
9:03 pm
when the issue is okay, take two flags, one with and one without. for every one of your 100 different plans, you've made it twice as hard to shop. probably not consideration to people that care to the core about abortion. but if you are thinking about exchanges, it's actually a real problem. >> okay. we have tons of questions on cards which leads me to tell you that if you have an urgency about getting your question asked, we may have done a switch here. because you might not get your question asked from the green card. you may have to stand up and be heard. let's start with a very straightforward question: can you compare the administrative cost to states in the senate and house bills? the administrative cost to states in the house bill are
9:04 pm
minimal. because they -- if state wants to run an exchange it can. it will have to pay matching funds for doing that. but if the state chooses not to run an exchange, it has no administrative cost involved. under the senate bill, the states are responsible both for enforcing them all and for running the exchanges. the cost of running the exchanges the presumption is we'll be born by the ensurer that will way some kind of a surcharge, as they do in massachusetts i believe. the cost of enforcement will be borne by the state. it's unfunded mandate. the administrative cost to the state upside the senate bill i think are going to be considerable. >> i guess i would take issue with unfunded mandate. clearly in the house version if
9:05 pm
the state doesn't offer the service, it doesn't have to pay anything. on the other hand, it perfectly unclaire what level if federal subsidy, if any, will be able to state from the federal treasure -- from the federal budget to pay for state exchange. on the other hand, i actually think having the state that run exchanges surcharge the transaction, which is why they are in business and actually have to manage the cost of their services and competitive market is a perfectly reasonable way. and focuses the objectives of the local, or researchal, or state exchange on its fundamental objective. which is to get people insured in the most affordable way. so i actually would take some issue with you at describing that as an unfunded mandate. >> i was talking about the enforcement cost, not the cost of running the exchange. but yes. >> let me just follow up.
9:06 pm
there's a related question here that notes health insurance is regulated at the state level today. if the exchange is created the the federal level, who would staff the federal exchange? and how much would creating the new structure and running it cost? does anybody have any notion about that? i don't remember seeing anything in the cost estimates. >> the federal exchange would be run by the commissioner of health choices. which is a new administration that's going to be created under the house bill. the cost of running the -- of the running the exchanges is to be appropriated by the federal government based on funds collected from the penalty for the employer and the individual mandate. and i don't know what the cost is that cbo has put on that. in fact, i'm not sure there is a cost that's put on that by the cbo. >> okay. >> so you have some cards.
9:07 pm
>> another question, how will you senate approach the 50-state exchanges work and the 10 smallest state with under 1 million population? >> if i can magnify that, there's a new paper that i don't think we had in time to put into your packets from the economic development. joe and his colleagues, which asserts that you need at least 100,000 lives in an exchange to make it viable. >> yup. >> the -- i think the further problem is that since under the senate, the change is not exclusive and since the presumption of the senate that a certain number of people will stay outside the change in the nongroup market, i think you're going to be dealing with some very small exchanges that i think are going to have a problem with provider insurers
9:08 pm
with viable risk poops and enough to be viable in small states. now the senate contemplates the possibly of regional. of course, the state could always forgo and let the federal government or contract run it. i think that's part of the problem that i was pointing to with the respect of risk pools. >> if you take a business approach, -- business analyst to this. you've got basically three sets of cost. you've got the business functions that are variable in selling insurance, you have the fixed cost, and you have what tim was referring to as some of the unfunded mandate. which i think he makes a good point about. which is the regulatory, the policing functions and subsidy distribution functions. and i guess the -- i would draw your attention to the fact that if you -- it's really the fixed overhead cost of the business functions that are largely where
9:09 pm
the economies of scale can be from having sides. when phil's folks are on the phone with employer x, y, z explaining to joe gas station why they have to file the new form and why they can't pay somebody for health benefits than somebody else or what the difference is between the ppi or hmo or any of the other questions involved in servicing a client and selling, that's largely variable cost. you could have it centralized in washington or baltimore who would not understand trying to answer those question over the phone. or you could have somebody in hartford and it would cost no more or no less in general. what you are going to have the scale economies on, and some of the regulatory enforcement are highly available. if we had the scale economies some of the regulatory funks, the web site, corporate
9:10 pm
overhead, sort of overall management of this entity. there, i think, i don't know about the 100,000 as a reasonable trigger point for adequate risk pooling. but the experience we have in massachusetts is that somewhere between 50 and 100,000 is the trigger -- is where you get sort of -- you start to get diminishing returns on scale for those web-based functions. they could be -- if they really turn out to be some super stuff that you can do. which is clearly bigger than any state exchange. you could have a national utility function. you'll need one for the own exchange in 17 or 3 or 27 states don't step up the line and could and should make that available to the states that do have their own exchanges. >> yes, go right ahead. >> i'm with the national partnership for women and family. i was wondering with to go tough with researchal, if the senate
9:11 pm
larynx prevails and they form regional exchanges, how do they reck size the rating rules and other regulations? will they have to harmonize for the same longs under the exchange? >> i got very brief answer. that's in minor scale compared to the same question for 50 states and one exchange. that's a very good issue. to be perfectly frank, i've had -- may be it's happened. but i have not in a year of discussions with folks on the hill heard an in-depth discussion of harmonizing national or regional exchanges with local with state insurance regulation. and i know in massachusetts, we work hand and glove with the state division insurance. so, for example, if we want to take an existing product off the market because we are standardizing our benefits, phil and i have both eluded to that,
9:12 pm
that directly impacts the division -- the message of division and insurance regulations on preserving access for the existing members of that product that you would like to sunset. and that's something we'll work out in conjunction with the massachusetts division insurance. so were the national or new england exchange to want to be something similar? they have to deal with 50 or 6 different agencies and sets of rules on just switching out a product within the exchange. it's a really good question. it's magnified on the national scale. >> i'll agree with john's comment. because any time we're making changes within our exchange, even though we are operating within the private sector, we are taking a look at are talkine department. and sometimes meeting with with the insurance department to sometimes determine what we can do going forward. as i said earlier, it touches everybody. it is local. so it really needs -- i think as it plays out, it's going to play
9:13 pm
out more at the state level. it has to coordinate with the states. >> one response to that is i anopias pate considerable standization of state insurance laws under health care reform. if probably under both bills. but the house bill -- basically the way the house bill works as i see it is it doesn't nationalize insurance regulation. it says that the national government, we are going a national health care reform. the national government, specifically the commissioner for health choices is accountable, is responsible for the enforcement and implementation of this law. and then there's lots of language about coordination, consultation, joint efforts with the states to try to implement the law. but number one, a lot of the issues that are currently addressed by at least state marketing and consumers protection laws are addressed by
9:14 pm
this law and presumably will become fairly uniform. they do not preempt. it's not erisa. but they do cover a lot of the areas that are covered by state law. to the extent that the state law will prevent the establishmentation of the law. secondedly, a lot of the difference is in terms of mandates. under both the federal and state, if they want to mandate, it is going to have to pay for that coverage for anybody receiving premium subsidy. my expectation, that's going to create a race to the door to get rid of a lot of state mandates that vary from state to state. so i guess my response is that number one, we're going to see more uniform -- more uniformity between state law once the law is adopted. number two, that in my event, the federal law has -- the house bill at least, has the attitude
9:15 pm
of cooperation and coordination that i think is going to help work through those problems. but that will be an issue. i guess the fear that i have is sort of the reverse of that. that if you go with the senate approach, a lot of states frankly are pretty weak on insurance regulation. and they are going to stay that way. and they are going to be responsible for -- and a number of states have already indicated they don't like the law. they don't want to have anything to do with it. i'm not sure they are all going to opt out. some of them may sit there and see if the federal government will call their bluff. i think that's going to be a real disaster. >> i agree with some of the thing that is are going to come together. the guaranteed renewability and some of the rating rules and how you rate are going to come together. some of the pieces are going to be far apart. connecticut is one, you talk mandates, that's something we talk about all the time. connecticut has a very high list of mandates. and, well, i've been in the
9:16 pm
business a long time. i've never seen one mandate reversed. >> are they going to be willing to pay for all of them out of their own pockets? >> maybe. >> i can't say -- i can -- i know it's been -- >> let me jump in. i've shocked to begin to realize that my ten-member board will seriously begin after enactment to debate whether we should have our own state assessment penalties for violation of mcc on top of and in addition to federal one. that's how states think of the way they do things even if there is a lot of goodwill in a federal -- piece of federal legislation. >> john, what's mcc? >> i'm sorry. minimum credit coverage. federal enforcement of national standards. we have our own in massachusetts. and i've just begun to realize how difficult that set of
9:17 pm
conversation is going to be with our governor, my own board, do we see that or do we overlay ours on top of the federal standard. after all, it's a revenue source. for our state treasury right now. >> yes, go ahead. >> i have two questions. the first that you mentioned undocumented workers wouldn't be allowed to purchase. you talk more about what options might be able to them for private insurance if that was even a possibility? and second question is, if the tax exemption benefits went away and hence the large group market, that market was forced to the exchange, how do you think their benefits and such might compare? do you think they would be better or consumers worse off? >> i'm sorry. could you repeat the second question? >> second question is if the tax benefits for health benefits for employers went away and hypothetically people in large
9:18 pm
group markets and large employers lost their and went through national exchange, instead of consumers, how consumers might fair versus getting benefits to the employees? >> with respect to the first question, under the senate bill, presumably, the hope is that they will go hope. [laughter] >> if they don't. which i think they are unlikely to. they live in a town with great many undocumented workers. if they don't, under the senate they can continue to buy health insurance in the nongroup market. if that provision were incorporated into the house bill and the house bill exclusive -- nongroup market is only available through the exchange, i suppose they would not be able to legally buy health insurance. and i think that's a real problem. i might be missing something there. >> go ahead. >> and that's the second part of that question is what happens to the large companies benefits
9:19 pm
went away and each individual was buying through the exchange of their own individual coverage. i think that's what the question was. if you take a look at many of the large companies today, their benefits are probably richer than what individuals would purchase for themselves in an exchange. so they probably would be -- they would definitely be -- their benefits would be less. i want expect from what takes place at larger companies, a lot of the programs they have in place, the cost would be slightly higher. >> i can't imagine that happening. although the cadillac tax bothers me. like has been said by many people and like the amt, that is going to grow and grow and grow. and at some point, we're going to see a very high percentage of the market subject to that. and that's going to be dramatic cut in employee benefits if not their elimination all together. but i don't -- none of the democrats right now are talking
9:20 pm
about abolishing -- that's not going to be in the legislation. >> 2/3 are buying through the employee. the slides that sara was talking about were showing the employee base staying in same. i can't imagine that much dislocation in a quick time frame. >> can i just tie those two pieces together. what happens with under the legislation if anything to undocumented immigrants who are now covered under employers-sponsored plans? are they legally going to be able to continue? >> well, they are not supposed to be employed. but i don't -- the legislation does not otherwise address that. [laughter] >> fair enough. >> hi, i'm ann with sciu, i wanted to ask john, i guess in particular, but any of you can answer, my assumption has been that the small group market
9:21 pm
should shrink dramatically. the offer rate are very low. most small employers might give workers more money and say go shop in the exchange as individuals as opposed to trying to preserve the small employer groups. and so, you know, you are really hard on the house bill on the small employer piece. i just wondered you're in a state with a lot of experience. i wonder if you could speak to would that be so bad to grow the individual market? and, you know. >> you know, actually, ann, i'm really glad you asked. i probably as usual miscommunicated. i don't have a problem with the house version focusing on nongroup. i think when you have a mandate, many of the new that need subsidies, that's a huge undertaking and a very appropriate task for a national exchange. i think that can work. i just don't think it's going to work for small group. now to your real question, so
9:22 pm
isn't small group kind of going away? i don't -- i wouldn't bet my first born on it. it's, you know, as you know with the union, there's nothing more meaningful adds a may be the second most important element of compensation after pay is health insurance benefits. and i know massachusetts is exceptional. but there's still a lot of small businesses around the country. when they are competing for your or my services whether they offer health benefits as opposed to somehow we can prove that we pay you $1,000 more a year for you to go off to the exchange or some place else and go buy it. there's really not much of a comparison between those two offers. i think you've got, you know, 50% or so of the small businesses employees more than 50% of the employees across the country offering group insurance, i would not expect that to significantly diminish. particularly because now you
9:23 pm
have the added incentive as an employer that your employees have to go by it. and they are really looking to you the employee not only to help organizize the choice but fundamentally to give them some money to go buy it. i don't see small group insurance going away at all. >> plus both the senate and house include small businesses to cover the employees. they are short-term and not that huge. the cbo does see them as having a significant effect. >> good morning. we're from the national academy of social insurance. professor jost, could you go into as to how difficult to administer risk adjustment outside and as well as inside? also with the senate would hhs or would the exchanges be the best? >> under the senate bill there are actually three different risk adjustment reck anymores.
9:24 pm
two of them short term. one of them long term. one of them is a reinsurance program which is to operate for three years. one of them is to risk program, which i can't for the -- i keep thinking this just ended up in the wrong bill. because it talks about hhs paying premiums. hhs isn't paying premiums. i don't know how that works. i'll be interested to see. i hope. but the third is a risk adjustment program that would take money from insurers with good risk and give it to insurers with bad risk. that to be operated not through the exchange but some other kind of entity the state is supposed to contract with. i guess the problem that i see with that is -- and the house bill is list the premiums for the premium subsidies for to -- to account for risk. and that it seems to me is pretty doable. you are going to be dealing
9:25 pm
within the exchange. you are going to have a lot of data on who they are insuring. it seems that's doable. it doesn't really address the problem of small group. although maybe john is right ad there will be no problem with small group. because in the house bill you have small group within and out and the takes place within the exchange. with respect to the senate bill, however, where w this risk adjustment, it can be done. there are states now -- a number of states with reinsurance and risk adjustment pools. i think it's going to require collecting a lot of information that the states would not otherwise collect. >> lynn quincy. i want to thank the alliance for the commonwealth and the panelist for a great session. it's been really informative. i'd like additional clarity on how exchanges can help small businesses? which i know is maybe a little
9:26 pm
odd comes from consumers union. i feel like this is very not clear as all. there are big differences in the bills. small businesses can purchase in and outside. i think i heard a panelist say there's really no other way to do it. in one of the bills the tax credits are able on both sides. in the other bill they can only get them in the exchange. in the senate bill, the exchanges are senate should those two exchanges be together. and finally, under -- what can we do to make sure -- another thing that is very odd is in the house bill, i think, individuals in small groups are pooled together in in the exchange, but then there's separate that's just small business outside the exchange? could that possibly create -- make rates higher for nongroup participants? i know that's a lot. in general, i'd like to know the thoughts on what's a good way to help small businesses with
9:27 pm
respect to exchange design? thank you. >> let me start with just the exchange itself and the question i think was -- first why is it good for small business? if you think about it, come back and say, okay, let's say you worked typically when i do i do it a much smaller group. we are one small business and try to equate it that way. if you think about it, the exchange brings simplicity and brings the choice for an employee based on their specific needs. we offer four different health plans and a range of benefits. so each employee can choose the specific network that they want. why is that important? well, typically if a company is losing a benefit, they are choose from one carrier. that carrier will have one network. they will have one set of formulairs. it is based on where the owner wants to go.
9:28 pm
in this situation, the ploy can choose -- i don't necessary have to go to that -- the occupier side. the owner is trying to provide a good benefit. they can now choose based on where the pediatrician, ob/gyn, based on anything that they know even from a satisfaction side. and hopefully, at some point will have transparency of provider quality and rates so they can make those decisions as well. and it's going to really -- it leads to a high satisfaction rate. i mean we do -- we do a survey of our -- of the companies that participate in our program every single year. we get very, very high satisfaction. and we go into a lot of different questions and can -- and what they experience is within the exchange. so that's really an explanation within why a small business gives satisfaction to each -- to th employees,
9:29 pm
because it makes it you have simpler. i don't know if i want to add. there was several other questions. >> i want to add one thing, it's a great thing to come back to my: humility. jim exchanged the theory of choice and competition. i would throw some of those employees would decide to buy up, their grandmother had it, whatever, they are willing to pay for it. others will buy down. if they are using their own money, let them make that decision. presumably, most by down. it adds price pressure. which hopefully stiffens the spines of the insurer to take the price out or go get a hospital. you asked a whole lot of other questions, lynn si. i want to be humble, i want to ask other people in the room and city. we don't know the answers to most of those questions.
9:30 pm
we need to dedicate some real resources and learn and adjust to make changes as you go along. >> joy from internal medicine news. i'm interested to what happens to the role of insurance agents and brokers with exchanges. are there provisions for the that in the house and senate and what the experience has been in massachusetts and connecticut? >> i we both use brokers. the nongroup is no brokers. there were no brokers. that's where we focused. so far as nongroup. so we haven't changed market practice. we don't use brokers there. now you contrast this. i'm going to give you an example in california where brokers drive the nongroup.
9:31 pm
there are 3 million. there were 36,000, there are now about 90,000 thanks to the reform. the the broker get 10% or more of the premium in the first year. very different broker situation of if washington were to dictate how to deal with brokers and massachusetts and california, day one, hard and fast, you'd have two very different outcomes no matter what the rule was. and very possible chaos. there's a real function there. now one the reasons, for example, is no brokers in the nongroup market in massachusetts is guaranteed renewable and community rating. in other states, brokers in the nongroup are critical to finding a carrier who will take you. so it's very different state to state. >> and in the group marketplace,
9:32 pm
the broker plays from our stand point a very important role. our average-size company that we ensure is seven or eight employees. they don't have a human resources. they don't have -- some of them don't have access to the internet. they don't necessarily speak english. there's so many different aspects to it that the broker typically is meeting with those employees and helping them through a very plex and as we've gone through, their personal decisions. and so they have played a very important role for us. now we did not -- we paid -- well, when we first started in 1995 we kind of changed. we pay a market rate. which is the same as they would get outside. go back to california, the california hippic was a public sector exchange that came up in 1995 as well. they came up with a program. they said the employee could
9:33 pm
determine if they wanted to use a broker. and they would be. here's what the cost would be if they wanted to add on. 75% at the beginning, i believe, used a broker to begin with. and their sales were not as robust as when they said we're going to meet the market. and then they -- their sales were much better. although there's other situations especially, the adverse selection issues that they had to do the california hippic had to do things at the open market didn't. which created a real problem for him. unfortunately, california hippic is not a available program anymore. >> it was interest fog me to see the revolution of the roles of agents and brokers as it moved through the legislative process. originally the house bill said nothing. part of the blue dog said the role of agents and brokers shall not be adversely affected. and financial committee bill said that the secretary shall come up with rules for setting
9:34 pm
commissions. that disappeared in the managers amendment. you can see this in the trade press as well and those of you following and are interested in making sure they continue to a have a role. i think it's absolutely right in respect to the small group. they will have a role. it's hard for me to see that agents and brokers, if you fully implement an exchange in the nongroup market it's hard for me to see that the agent and broker is going to add value added of 10% when you think of all of the other things that health care cost are supposed to cover. when you discuss this with somebody earlier in the year, they said, remember, there is an agent or -- there's an insurance agent or broker in any lion club, every pto, when i go to fund raising, some of my best friends are insurance agents and brokers. they are all there. this is the the grassroots levels one of the most powerful
9:35 pm
groups in the united states. it's hard to imagine that they are going to go away. and they do again serve a useful function gnat group market. but i would hope that one the exchanges would be to figure out what exactly agents and brokers are contributing. and then make sure that they are compensated for it. i don't see any need for 10 to 20%. it's like if you could buy through web-based travel platforms and still had to pay a travel agent every time you get -- anyway. you've heard me. we have times for the questions standing at the microphone. first in the back of the room. >> hi, thank you to the panelist and to the commonwealth fund and alliance for putting this together. my question is about the state exchanges and the history.
9:36 pm
because in terms of going to scale, this health care reform is proposing to put 30 million people into sort of an exchange. that's a large scale in terms of having it happen in day one. wanted to ask you what has been the obstacles for more states taking on running an exchange that would move us toward the level of scale. looking at what the obstacles are. look through the senate bill that puts it on to states first. if they default or refuse or are not so great, the feds step in. what in the senate bill helps states to overcome that obstacle that we get on day one if 20 million -- 25 million show up, it's going to work. >> that's a great question. and my somehow informed, i read all the literature and lift one
9:37 pm
the exchanges. the opinion is that most state or local exchanges have failed because the value proposition in the absence of mandate and subsidies run through the exchange, for the exchange to step in and materially improve the purchase experience and affordability for small values. phil has done a great job. but with modest value. i have a member of any board. he's an absolute expert insurance. he runs a little business in connecticut. he checked out cbaa. better deal outside of cbaa. it's not like -- it's hard to believe, i know. it's not like -- i think even phil would admit, you can get the same protect for 20% less. the value proposition has been way over blown. a lot of states jumped in in anticipation under reform under the clinton. of they tried this.
9:38 pm
they found it wasn't sustainable . what's different about the senate and house, subsidies would be in set flow to hundreds of tens of people in connection with purchasing with exchanges. that's a huge difference. that's all the difference in the world. that's the enterprise and opportunity to develop what's taken bill 15 years, and i imagine cross subsidy from their parent association to create the value. which is still -- if you measured it, a couple of points on the proceed yums. people move for a couple of points on the premiums. and it's great work. you know, so what's the value for our unsubsidizing exchange in massachusetts. it's literally the difference between spending a half hour on our web site and being able to see and having to spend a day on the telephone to try to read your notes at the end of the day. is the price any different?
9:39 pm
ab a salutely not. it's the same price inside as outside. so we're dealing with fairly marginal differences. expect if you have a mandate and subsidies to pay for the insurance? >> now the rebuttal. >> no, no. i agree with most of it. expect by the way, there was no cross zone. our parents did not help us. but in a lot of states -- states looked at trying it bring up exchanges. and again, a lot of it came to what was happening outside the marketplace and how they would have to run an exchange. and the rating rules are different. many the state that is we talked to, we're not going to be able to get critical mass. we keep talking about it. i don't know if 100,000 is right number. we've run it smaller than that. but they have not been able to really overcome that barrier of some of the market forces outside of the exchange need to be similar to what's inside the
9:40 pm
exchain or there will be real problems to be able to run that exchange. and that would take me longer to exchange exactly what those pieces were. that's what the states had to be very, very careful. that's why they have not been able to become live. >> i think someone had mentioned that standard benefit would be in the both the house and senate bills. i see them as crucial. as far as the sandized, do you mean standardized coinsurance rates and copayment rates as well? with that be included in the standardized benefit? and two, who would design these standardized benefit packages? who would be responsible for leaveing in psychiatric care, leaveing in mental care, leaveing in dental care and so forth? >> the answer to that in both of
9:41 pm
the house and the senate bill this is the concept of essential benefits. and the list the kinds of things that needs to be covered by inpatient hospital care, like physician services like pediatric clinical -- preventive services. but then it leads to a process which is lined out in great detail. i don't have it fully committed of. that would run through hhs i think in the senate bill. i think run by the commissioner of health choices with the representatives advisory board and the house thing. and then it would be updated through a process. that's the essential benefits package. with respect to cost sharing, both bills tier packages in terms of actuarial value. and the senate has four tiers
9:42 pm
plus a catastrophic plan that's available to some young people and people at with the other category. they can't afford insurance. and the house bill has, i believe four tiers. and cost sharing then is determined by those tiers. i mean the tiers basically are trying to terms in actuarial value. so they basically drive cost sharing. so cost sharing is standardized and then of course there are maximum amount of pocket limits in both bills and under the senate bill there are for group health maximum deductible. there's a lot of flexibility. if you want to have a high deductible health plan, you can do it under both bills. >> can't that be a way of avidding high-risk individuals? >> yeah, one concern that i have under the senate bill is every
9:43 pm
insurer who participated in the exchange has to market both the silver and gold plan. but they don't have to market the bronze plan. which means they can market the bronze plan outside the exchain. or someone can stay out of the exchain altogether and market the bronze plan. and higher deductible, higher cost sharing tend to attract healthy people. i do see that as an -- one of the wrinkles in the senate bill that makes me a little nervous about adverse selection. >> one of the things that tim was saying, but it's worth emphasizing is while the actuarial tier project cost sharing, we have used tiers with the 2,000 deductible and 25 copay or 0 deductible and 35 coinsurance. there can be very, very different kinds of cost sharing that have the same overall value from a actuary.
9:44 pm
your point about nonstandardization, which is one of the reasons why phil and i have moved towards standardized benefit and standardized cost sharing so you do have some comparable. and the range, frankly of cost sharing. in massachusetts what we think of minimum would be cored middle -of-the road in texas. these are very different across the country. they are going to be a real issue in the house verse. which is frankly above what most small employers provide in many parts of the country. they provide more cost sharing than 30%. >> and standardized benefits is -- has been -- i feel one of our keys. if we hadn't had standardized benefits between the four health plans, you are just opening up problems. and, you know, it's very concerning. and then john's point across the country. just varies tremendously.
9:45 pm
>> as i turn to sara collins for the final comment, let me just ask you to reiterate my request, that you fill out the blue evaluation so that we continue to improve the programs for you. sara? >> thank you, and thank you so much to the panel. it's been an excellent conversation. end i do want to just emphasize too how critical that piece of the reform bill is. it's -- we've focused a lot on the public plan over the last year. and some other and rather pieces of the proposals. i think this really is critical. individual and small group market is have people lose their coverage until the united states. they drop through the system hat that point. this is the fix to those markets if we are going to build on the existing system. and the issues that are raised in the tim's paper and by the panel i think are really critically important both in terms of deciding on the provisions in the bills, federal versus state control. and also implementing the bills
9:46 pm
over the next -- over the provisions over the next few years. thank you. >> thank you, sara. thanks to our friends at commonwealth fund for supporting some the research that was used to such good effect in this conversation. and for supporting and participating in the briefings. thank you for your fortitude of listening to a lot of actuarial termology over the -- terminology over the last hour and a half. i think if the insurance exchanges in whatever form run as well as this exchange has run -- [laughter] >> the country is going to be well served. so thanks very much to all of you. [applause] [inaudible conversations]
9:47 pm
>> coming up next, kelly kellyanne conway, and then michael steele and that'll be remarks and a press conference with the japanese prime minister.
9:48 pm
>> now republican pollster kellyanne conway gives her thoughts on the 2010 mid-term elections, the obama technicaltion, and difficulties, we join this five minutes into our comments. from the heritage foundation, this is just under an hour. >> let's talk about 2010.
9:49 pm
hot issues, what we see happening. first a little bit of perspective. 2008 politically was really all about individuals. the main narrative and discussion points were all about individuals. hillary clinton, perhaps the first female, barack obama perhaps the first african-american president, ultimately was elected. sarah palin, big surprise pick in august of 2008. but much of the polling questions, much of the media coverage, much of the discussion around as the proverbial water cooler was about the individuals who were running for president. 2009 was a shift away from individuals and back on to issues. and we saw this when you look at the tea party goers and what they were talking about at these tea parties. fiscal accountability, the exploiting deficits. bailing out wall street, bailing out detroit. bailing out your neighbors
9:50 pm
subprime mortgage. great concern about issues, particularly fiscal issues. the town hall meeting that were centered around health care. health care not as a heart string issue as the i think the administration was banking on. that health care would just be seen as a heart-string issue. by many of these concernened and nervous citizens were were taken those concerns and thank anxiety to the town hall meetings. that's a good thing. i think all of us should be happy about that right, left, and center. particularly as conservatives, they are conservative women. because we don't lead with our gender. we want to talk about issues, individuals are just con due wits for those issues. but the issues are everagain. the issues have shelf life. and those are what is enduring.
9:51 pm
i'm happy to report any anybody's data, that is really what is dominating right now. i think 2010 will be the same president main themes are security and affordability. and i think there are more than they have been than just issue driven. because when you talk about security, to someone it may be capitalist social security, to someone it may be the fact that the transportation security a, the tsa still has no head. there is no one heading up the ta -- tsa. the nomination was made in september of '09. it is being held up as the "washington post" reported on new year's eve day, there are some concern that is he abused his authority not once but twice digging up dirt on his exgirlfriend's boyfriend. people are concerned about that abusive authority.
9:52 pm
the tsa couldn't put the on button the cameras at newark liberty national airport. they weren't recording. they were working. they were streaming. but nothing was recording for six days. we have to be concerned about this. the president said yesterday that it's time for citizenship, not bipartisanship. final, then let's have a tsa that's work. by the way, let's put somebody who can head up or security agency, our administration. while we're speaking of citizen, not partisanship, let's now the secret door for the closed or secret, i can't even find the door. let alone open it -- [applause] >> health care negotiation. negotiation does not occur behind closed doors. the american people were told you'd have the seat at the table. this would be different. that you would be able to see and be a heart of our health care negotiations. and i can assure you having some across capital hill at a meeting
9:53 pm
withing that i are not open door. nobody with even find the door it seems. this is no way to be deciding the fate of probably one of the most significant pieces of legislation in a generation, in not two. so i think these issues are very important. i want to talk to a little bit about -- hi -- a little bit about polling numbers today. i do want to do a quick preview of the first year and on a bunch of issues. also a number of attributes. because this is somebody who ran on monosyllabic. but specifics and governs are very different. and i would submit much more difficult task on the matter of hope and change. when you are doing making history, you need to start making policy. it needs to be really heed polls and public opinion. i know many elected officials and many voters are skeptical of
9:54 pm
polls or they say i lead by example. i don't listen to polls. polling, however, if taken correctly and scientifically and are artistically drawn, fairly worded questions, not like the ones i read earl your. polls can be the touch tone. it gives us an opportunity to tell our elected officials and opinion leaders who it is that is making us anxious or frustrated. what are our expectations and desires and hopes. some of the best incites that i have heard individuals responding so polls or focus groups. there's a certain richness of opinion and knowledge that comes from we the people. i hope more e effect will -- elected officials will look at the polls if they are properly drawn. what have the polls been saying? everybody polls have said the same thing? the number one issue this year
9:55 pm
the entire years have been jobs and the economy. that's it. when health care started to spike up to number two or number three on the list of issues with it wasn't necessarily because people are saying that's a great idea that you're talking about health care. it's also the number two and number three issues because people are worried that what we hear and see might actually come to pass. that's very important insight. we need this now. what they are seeing, reading, and hearing about it may not be the best idea. if jobs and the economy are the number one issue, and even if today's jobs came out and shows unemployment still 10%. it was 6.8% right before the last election had the numbers right here. and headed into 1994, unemployment was under 5%. so if it's at 10% now, 19945.6,
9:56 pm
1997, 8 -- 6.8%. why hasn't that been the number one issue? that's what's really concerning them p why has it been a bigger priority to up in new mexico and force u.s. tax dollars to go to fund abortions internationally which 82% of the country is against. why is it so important to bailout wall street to bailout detroit, to make sure that certain mortgages are protected, even though people are saying that's not -- those are not the number one issues for them? why is it important to fly to copenhagen not once by twice for the a global warming conference in the middle of a blizzard. i'm not saying that to be snarky so much as i'm asking the question. why aren't we listening to people with they say they are starving for jobs. they are looking for economic
9:57 pm
rebound. why don't we look at the 16 million plus women who currently own all or part of a small business and think of the untold millions of other american women who would love to harness their spirit and create a nest egg end flexibility and ownership for their small businesses. why can't be allow them just to flourish rather than trying to suffocate them from the beginning? and so i want to read some of these numbers to you. i'm looking at over 30 cross tabs right here. and we've compiled this from a number of national and publicly released polls so that the sample size is taken from over 3,000 people in the each of the 3-month periods between january '09 and january of 2010. over a full year now. president obama approval ratings have designed among every single group with the exception of african-american voters. he's up 5 points in his approval
9:58 pm
rating. he's down one among self-identified liberal democrats, down 3 among democrats, down 15 among independents over the past year. he's down 16 among men, 15 among women. every measure, both genders, every income group, every age group, every geographic group, all levels of formal education, every marital status, down in his approval ratings. and i am second to no one in talking about what i say, the unbarable likeness of approval. people don't go to the ballot box and only ask do i like you? do you appear to me? do i feel favorably? and does critical mass of america feel favorably? but this is a president who when running in the campaign ran an awful lot on the appeal and likability. go back to many people that endorsed him, they would talk about that. the ken dwis talk about his appeal and charisma and likable
9:59 pm
-- likability. it's fair to look. i was on tv last night. mark penn who was hillary clinton polster and pollster to many democrats was still talking about president obama generic approval rating. let's show that on media, the approval rating has declined in the past year. why is that important? because he is not just the president of the united states, he is the commander of chief, financial policy, and he is the leader of the party that currently holds very strong majority in both houses of our federal legislature, many governorships, many state legislatures. he is the leader of the party and he is the chief messenger on all of those things. so it is significant.
10:00 pm
:
10:01 pm
national security not partisanship, but down 26 of his measurement of unite the country and not divide has a clear plan for solving this country's problems down 19-point. cities are measurements attributes issues generate approval. what does it mean? it means people are anxious. i think it really does short shrift and is dismissive of concern citizenry when people who are showing up to keep party meetings and protests in the pouring rain who are taking it right to the members of congress republican and democrat this past summer about health care it is totally dismissive and unfair to them to say that they are angry, they are i rate, look at them.
10:02 pm
they are nervous, they are anxious. they are worried about generational did come exploiting federal budget deficits, about a broken campaign promises, and about the fact we are trying to pass health care reform when 81% of the voters in this country say they like the health care the house. is it in perfect? you bet. but they change things about it? of course and in short and in a marriage -- i was going to see marriage as wheat, jobs, 45% of people are happy in their jobs, slightly higher numbers and they are happy marriages, you'll meet new year's resolutions every year. we will always change things if we cut the high level of satisfaction or possibility that you're own health care reform coupled with an incredibly enormous price tag and a great deal of uncertainty. 500 billion medicare cuts over 100 some taxes the americans with tax reform group estimates,
10:03 pm
regulations, penalties. people are looking at health care reform legislation constitutional if it doesn't violate prescription against excessive fines and punishment since you can go to jail or pay huge fines for not having this kind of program. so, all of these are very legitimate concerns people are taking but security taken to the members come security and affordability people talk about a security, it is national security law but also can be social security. affordability, but can be taxes, debt, deficits, housing, college tuition, that could be basic cost of living and quality-of-life, that could be entrepreneurship, a kitchen table economics, wall street, main street, all of that has to do with affordability and that is what we are hearing is important to them going in 2010. much has been talked about with respect to their new democratic retirements and ones i think our
10:04 pm
eminent as well and how would that bode well for republicans? i think it bodes even a well for conservatives. many people laughed a year or two ago when we talked about how conservatism's on the ascendancy and president obama was elected and the democrats got free elected to both houses in the federal congress and a number of governorships and they've got 60 votes in the senate, 60 being al franken or arlen specter or a combination thereof which doesn't matter because it turns out they can't pass many things they wanted to any way because their own pockets so we are not a center-right country anymore, are we? and you read these stories some bye republicans how the republican party is a regional party and irrelevant and we are going to be a one-party system. the fact is that however the ebbs and flows go with party politics, conservatism has been the dominant ideology and philosophy and our culture for a number of years now and anybody who the fisa should look at
10:05 pm
anybody's polling that shows conservative 40% of americans call themselves conservatives. to-1 who will call themselves liberals. ladies and gentlemen this is why liberals don't call themselves liberals anymore. they've read the good data. they know that. the call themselves progressives and spent a pretty penny coming up with the term progressive. and i'm not even sure what it means. car insurance i know, but -- [laughter] if they call themselves liberals then perhaps you should come and why is that? it sounds so shopworn, you tried that before. even nancy pelosi doesn't stand there, who represents a fairly liberal and, quote, progress of district and say in this congress we are going to grab your guns and increase the number of abortions and taxes. nobody talks like that. nobody talks like a classic liberal. they all run a little bit more centrist when they have to in
10:06 pm
many cases and it is no other than william daley, who served in the clinton -- president bill clinton's the five cabinet who the past week or to have a lot better urging democratic party to moderate its views. does this sound familiar? the was the call for the party, moderate your views. yet you have 16 republican congresswomen about half of whom are pro-life, half of whom are pro-choice what i can tell through public information, and yet all of them unanimously voted against health care in part because it would change the law and allow federal funding for abortion. that included the pro-choice women in the caucus and the pro-life but this is where the conservative movement and the party are different. they say we are going to primary anybody that votes for the house. this is like religion to them and.
10:07 pm
welcome to the fifth biggest crowd. [laughter] for them, there is no compromise. and yet we are able to welcome in the republican party people of both views. but the conservative movement is on the ascendancy because we are taking along with us not just 40% of americans who call themselves conservatives but a huge number of independence. 60% of whom voted for barack obama just a year ago, and many of whom now are calling themselves conservatives and aligning more with republican party but before you get excited about it, moderates are still buying a large aligning with democrats. independents are aligning themselves with republicans. there's a difference. moderate and independence are not interchangeable even from moderates to independence so it's not fair to use those interchangeably when looking at the political landscape and possible realignments. when people are thinking about the independent vote, they are
10:08 pm
not just independent because they are declaring independence from both parties and refusing to pledge allegiance and in fact over 60% of independence disapprove of republicans and democrats in the congress right now. that's their job, they are independent. but many of them are libertarians also, and you see many of the shooting but the team to the cut on -- towels and tea parties. as you see the democratic retirements to start to see a number of conservatives come out of the work and say 2010 is my time as to of the sidelines. many of them were always sickly minded dutiful voters but they sat out in 26 and sat out for some of them and 2008 but particularly 2006. why? because they were not going to vote for republicans acting like democrats. so i'm pretty sure they are not going to vote for democrats acting like democrats but they did not vote for republicans acting like democrats. i know lots of people back in
10:09 pm
2006 say the republicans lost 30 seats because of the particular scandals. i think we lost their seats because of that. but we certainly didn't lose geographically disparate seats buy ideologically very different members like minnesota or sue kelly of new york or jim leach in iowa, palatial and florida. i'm naming these off the top of my head. terrie different members of congress, very different records in congress. there's something going on and it's because many would-be republican voters. most of whom are conservative stayed home and sat out. they are conscientious objectors voting not because they don't pay attention to politics but precisely because the do, and they are coming back. this is looking at the polling really debating whether or not the likely voter model mix much since this early on in 2010. we all do the likely vote her novel. i have been one of the major proponents of having even more
10:10 pm
sophisticated screens to finally the voters, that isn't just prologue and you can use voter lists because you are leaving our young voters and nonvoters to veto new voters. immigrants can vote because the amount of their citizenship and can vote. you are leaving of people who have moved, who are in a very mobile country and you are leaving of people who have been lapsed voters for many years but now feel like there's a reason to vote and if you look at 2008 evin versus 2009 in new jersey and virginia uzi voting electorate in those states just a year apart are so different, so we are using a likely voter ogle from 08 or 09 for 2010? and why would either one of why? why in the presidential year when candidate obama did a fantastic job of making virginia matter and shoving that and having dozens and dozens of offices but a cheerleader bob macdonald wins the state for governor and the republican conservatives when up and down the ballots. so which one is the likely voter
10:11 pm
model that's appropriate for 2010? i think it's important to be a little bit more open-minded and inclusive when it comes to who might participate in politics in 2010, and more to the point, who might sit this one out, and that is something that afflicted republican candidates in 2006 into 2008, and the question is open now with that will affect in 2010. you can't beat somebody with nobody, and that's why candidate recruitment is so significantly important, and i'm not a been counselor, i don't believe leading with gender and talking about immutable characteristics as being particularly important in identity politics particularly for conservative candidates. at the same time we are starting to see an uptick in the number of women filling up the pipeline and running as conservatives this year and that's fantastic if they want to do i always ask the media why are there 17 united states senators out of
10:12 pm
100 who are female when women are 53% of the population of the voters and look, you have got to want to run. you have to want to overcome a great deal and you have to really want to -- you've got to believe politics is the best place for your energy, for your talent, for your resources, for your future and for many women it's not just the fire in the belly any more, it is the bible in the throat. you have to swallow an awful lot to run for politics and i give credit to those who step up and do that. but the pipeline has been a little bit weakened and diminished even the center for american women and politics and a lot of other watchers of women running for office have noted many women have stopped running for office at a tremendous clip even at the lower level state legislative level and i think if the average woman particularly on women watch 20 await on paper, and as a mother of three
10:13 pm
very small group you can get excited on paper about a woman running for president, woman running for vice president and in practice it is so deflating. the way so many of these women were covered the coverage on hairdo's and husbands and the khator other than what they were wearing and what they were seeing it parsing everything said and many times i hate to report they were written by females journalists or male journalists who should figure out those issues because might argue covering what a woman is wearing rather than one she's saying when she's running for vice president of the united states? who has the problem then? and i don't see that changing any time soon. i think if you look at the coverage that's been going on for a while of the female candidates it's amazing the different questions that get asked. there's a woman running for congress to get she has five children and was asked very recently by a journalist, a local journalist and it's always with the squinted always an
10:14 pm
earnest voice and a raised eyebrow why can you do it all? can you balance it? who's coming to watch these kids. who do you think is going to watch these kids? that question there was a female commentator who made the comment of around the pole at the time about the 3 a.m. face 3 a.m. that hillary clinton had run when she was running for president but a twist was if the phone rings and vice president palin gets the phone call at 3 a.m. and one of her children is really sick what is she going to do, and i'm thinking okay that may be a fair question. maybe but why didn't anybody ask john edwards? when the phone rings at 3 a.m. and your wife who said the is very sick and or not, do we have a backup member for you? where do we find you at 3 a.m.? [laughter] never asked. i may have missed that story, so if anybody sees it please send
10:15 pm
it to me because i may have missed that. [laughter] it's not about double standards. it's just about how ridiculous so out of the coverage is and i get that question all the time about governor palin if first she can do it because she had a special needs child, and ticker out of the equation, i'm talking about the we female candidates are covered by and large particularly conservative and pro life, can she do it, and the knowles i am really worried about her children, and i'm thinking god, i've read your columns i don't even think you like children negative. laughter, and now you were worried about her children. so i stopped getting upset about it, and of course you want to take the phone calls and be helpful, and i like a whole bunch of these journalists and work with them routinely. i thought it was sort of a netherworld kind of equation where maybe they just, when anybody like that, they don't know anybody that has five children, they don't know anybody that does that without
10:16 pm
household help or without a husband or family members who help ought while five children and all of that and makes the school lunches but i quickly realized the thing to say is if somebody asked me when my billy has donato year almost five years consistently and they are thinking can she handled mauney work and that baby after that baby is born? guess what, like sarah palin as far as i can tell, who knows these days, as far as i can tell she doesn't have a boyfriend, so right there she's got i don't know, 13 extra hours i would think. [laughter] the time you spend with them, the time you get ready to spend with them, the time you spend covering that he spent time with them, the time you spend planning to be with them and covered -- it's exhausting. apart from my moral objections the logistics of adultery
10:17 pm
completely confound me. [laughter] and as far as i can tell she doesn't play golf. [laughter] i don't either so maybe i angeles. but right there again, that gives her like an extra, you know, 15 hours a week, seven on saturday, eight on sunday because they go for brunch or drinks or what ever is leggitt her 13 extra hours on the boyfriend, 15 hours no golf, that's like five and a half hours per child or 3 a.m. from the national security adviser etc. so it is a really light way of breaking down how ridiculous it can sound sometimes when people are asked that question. but even in the case of mrs. clinton having to put herself in but i called the campaign uniform beginning in when she ran for the senate and elizabeth dole was trying the same year in north carolina and their husbands had run against each other for years earlier for the presidency, and is anyone in
10:18 pm
this room going to questioned? the intelligence or the credentials or above the fides of hillary clinton or elizabeth dole, to of the only women in their classes had careers in their own right, and it had to win back the interest of coverage by sort of wearing the campaign uniform and the campaign yet from here do and as i observed i never see the store is not a bad clovers and beer bellies in congress and there are many. the other thing that's going on and 2010 that i see as being very hospitable to folks who want to run for office who maybe have never run for office is in large part having president obama to think for that. in other words i think the biography is very important to people. voters want to know who the person is behind the politicians and secondly this whole idea you have to sit in the corner and wait your turn or be next in
10:19 pm
line or hold certain offices along the way or pay your dues within the system has been up in did and not just the presidential level that is the most obvious and probably consequential example. but it didn't cut different levels to a 25-year-old was sworn in as a mayor in new jersey the other day and i thought okay, that i was born the same year that some of the suits in my closet were made. [laughter] i add that i shouldn't have them in their but that's jarring to think that he was born the year i was a senior in high school, the year geraldine ferraro ran for president. you put it all together you realize that this whole credential and structuralism and wait your turn and pay your dues in the system, i think it is great impetus for people who've always consider their greatest contribution to politics to be the 62nd voter. i don't and i gave $10 or $20 or $50 here and there and i did get out the vote program work talk about politics to other people
10:20 pm
or andre seniors to the polls or take my little ones to the polling place with me so i'm doing my job. now's the time to do more than that if you are so inclined. but to actually get out there and throw your hat into the ring. let me just -- i want to have time for questions but before i do that let me mention a couple of other statistics like a fascinating going into 2010 presidential race on the ballot. one is there are 34 republican members of congress who represent districts president obama carried in 2008. there are 49 democratic members of congress that john mccain carried into the sunday. so right away you start with sort of 84 districts just by using this simple linear measurement. 84 -- 83 districts that would seem to be in some kind of play. then there's a very fascinating number you don't hear about very often. 25 congressional districts that
10:21 pm
are held by democrats who won in 2008 but there are districts president obama won in 2008 but president bush carried in 2000 and in 2004. and this is also why looking through a simple lanier prism thinking they always vote republican or democrat or the mullen to make history or their status or progressive, it is really my youth and it discredits help people are making their decisions. if you open anybody's hand back right now you'd find the six different brands of the same products whether it was a vitamin or prescription or beauty products you would find all these things. if i open the pantry and see all the same kind of product and that's as consumers we are brand loyal but not monotonous and the same is true in politics and that is something to take account of in moving in 2010. two of the most important a matter of the groups to look at
10:22 pm
in 2010 are unmarried women and small business owning women and aspiring businessmen. as i mentioned before, in addition to the 60 million plus small business owning women in the country you have so many entrepreneurial aspirant's who look at -- they don't like the scandals and don't believe in institutions and security of big business america anymore. i should say business america because there's so many layoffs and regulations now with taxes and uncertainty. and they also want flexibility and ownership and they have a great deal of confidence in their own talent and skill set and there is access to capital and talent and clients said they are in prison and up for grabs. unmarried women favored barack obama for john mccann by 41 points. unmarried women between the ages
10:23 pm
of 1829 fever barack obama over john mccain by 55 points. 55 points because they are all brigades who would've won city do the same thing. practically. laughter cope they favored and i think that's a cautionary tale to the conservative movement and republican party because unmarried women are in their 20s and 30's, 40's these days and you have many women running their own businesses who are getting their degree is out in the workforce who are the net peters of so many decisions for elderly parents and aunts and uncles and other relatives and they don't have children of their own but spoil the heck out of everybody else's. this is a growing contingency in the population and many of them -- we have to admit they are financially sophisticated buying their own homes, they are availing themselves to the
10:24 pm
society. they are not waiting for me to become to become owners and the taxpayers and entrepreneurs and voters. so this idea you have to wait is shortsighted and minute and a cautionary tale and it's actually an invitation more than anything to recognize the demographic trends and what we can make of them. michelle mentioned my colleagues, democratic pollster who does wonderful work for her side of the law and was like to offer in the book what women want and we chose the title we were hoping minn would think it was about sex and run out and buy it and me get a best seller and be disappointed it was written by two polling. [laughter] and i'm sure you can find the books now years later at the dollar store, full price, 1 dollar. but she said something the other day on npr with the "washington
10:25 pm
post" reporter who has written a book, "cracks in the ceiling" about her trip with governor palin and senator clinton two years now and she said something at the end of the broadcast that was quite wise and we hope quite prophetic. she said she cut the first female president will be republican, and i know many people believe that, but it often doesn't get credit from the other side. and the answer she gave are exactly right. that a republican woman who will come from another elective position most likely or from business will be able to show both sort of these are my words financial sophistication, business acumen, strength and forcefulness on matters of security and military policy but also at the same time in business and financial matters, and yet still be able to show leadership and vision on what unfortunately has been called the, quote, women's issues like
10:26 pm
national security, health care, education since these are everybody's issues and i think women are smart enough to do the math and take care of the fiscal issues. and i think that is quite a prophetic statement i don't think it's going to happen tomorrow, but there is wisdom in that, and i think it also shows you why certain conservative candidates for office who are female scare other people because they are actually worried that these people can attend, and if the people were not a threat, then they would be ignored. that's the thing. the last time someone didn't bother me i didn't bother with them. so if somebody is a threat to your constituency and philosoph in this world vision you've had, then of course they are going to be attacked. but that, ladies, and a gentleman certainly, is no reason to not run for office. i think it's a tremendous reason to run for office the best thing i think any of us to discuss in this room for anybody watching so inclined can do in inviting and the more welcoming to the
10:27 pm
women to be part of the conservative women's network is very simple. it's to answer the question in seven seconds, 70 seconds, seven minutes and answer the question even when you're not asked, just say to declare an effort. answer the question "y am i conservative" not lie in a conservative woman just why am i conservative. answer that question and if you start out the answer with well or about or the same kind of soft whispered wincing eyebrow fanned concern that we get in those questions i mentioned earlier, then you're already behind. just answer forcefully. i did the answers are as multitude as there are people in this room and people watching. i bet for some of its fiscal issues, others social, for others it's morrill, for others it's got to do with entrepreneur ship. for others, it has to do with what you believe the proper role of government -- for others it may be disconnected from politics altogether and it may be the way i was raised.
10:28 pm
i was raised by four women, i always say that version of the golden girls, for a tally in women raised me and it's the gift that keeps on giving the lie don't remember a single political conversation ever, not once. and for some people that is enough. the leading cultural indicators influences of what they are doing every day in their lives. we've got to convince people when the women say i hate politics but i don't like politics. i don't like anything in washington they don't mean that because politics is the end of the means they don't care about. to say you don't do the kaput politics it means you don't care about which we health care goes or boozman in the education policy or what is happening with the tsa. we know nobody means that. policies demean it toward the end of what people care about. she answered that unapologetically here is why i am a conservative and why i think it is important to get involved in the system would be a boon to us.
10:29 pm
thank you very much. [applause] thanks so much, kellyanne. with an inspiring taught. i feel ready to go out and fight now. we had a little time for questions, two of the clare boothe luce ladies with the microphones. you call on people if you would like mind giving your name and affiliation and we will go as long as we can. >> td brown. i don't have an affiliation right now. but my question is from your polling, do you know or do you have any indication of why young women went for barack obama over john mccain because it seems to me it would probably be the opposite because it seems if you are young independent woman you would want more pro-business policies if he wanted to start your own business, so i was
10:30 pm
wondering if you have any insight into that? >> thank you. the question is about why young women would have a skill for barack obama over john mccain and may i say so overwhelmingly. i have already given the statistic about younger women but also has to the terrible sadness to the i should mention saving 55% of unmarried women between the ages of 18 to 29 favored abroad, by john mccain by 55%, married woman different ages of 18 to 29 favored mccain and palin by 12%, and i should have mentioned that. so it is more of a merrill status gap than just a sheer gander to the eckert tendered at or age difference but to answer the question, young people -- a young woman voting in 2008 basically all she had ever known in politics or the bush and clinton's in different orders and if she were enamored with either of the teams i would assume she would on with one of those two teams in other words
10:31 pm
given mccain her vote and given to the idea this was over bush's eight years or to be supportive hillary clinton in the primaries or decided not to and the general election because of the bad aftertaste in the primary against clinton but that was in the case for many young women. for them there for a into the national political barack obama. was his campaign and let's give the barack obama campaign a ton of credit whereas the have switched focus and discipline organizations as campaigns as the same type they are lacking now i think in governance frankly. one thing they did really well was use technology and use technology to connect with young people and make them feel included and part of something big so how did they do that. they had a program that is essentially for 1 dollar you can sign up and get alerts and be part of the campaign now if you pay a dollar to a campaign and they're going to spend more money to do you informed you are a loser to them that you are
10:32 pm
really not because i promise you are going to vote and you are going to get on facebook or something else, myspace wartell 100 other people immediately and even if 10% of them do what you just did telling millions of people it really starts to grow and i think they did that really will making young people feel like this was a candidate for them, somebody in his forties, young families, great story biography, a true american story in terms of who would have thought we would have an african-american president in our lifetimes, let alone now, and so there is a connective tissue there and it does have to with ideology young women particularly young unmarried women tend to look at the government more as a help than a hindrance in many ways. it's looked upon as filling in the blanks whereas if you live in a single income household or with other female friends until you start making more money -- it's proven to unmarried women or young or women tend to be more space.
10:33 pm
younger women tend to be more republican, so i think it accounts for a lot of that. let me also say it's nothing new. younger women and unmarried women voted in droves for clinton both times for al gore, the babe magnet so it has a lot to do with ideology. [laughter] and voted for john kerry. [laughter] so does have to with ideology and that is their right and our freedom loving democracy. so tested with ideology as well. but you're on to something important. it's my point about not just looking at women for the linear box looking at just age or marital status. if you are an aspiring entrepreneur of a certain age cut and why aren't we just talking to you about taxes and regulations? why are we insulting you by thinking all you would think that is same-sex marriage or a portion or that you don't make money if so you can't do the math and you don't understand who mr. fica is yet. gist people to treat technology is a big part of it.
10:34 pm
for all of the, you know, for whatever people want to say about president bush or senator mccain, one of them i can't remember which was which, one of them referred to the internet's, broken and the other one said a google, symbol. that coupled with you could pay a dollar and be part of my campaign as and facebook page and all that is quite remarkable. yes. >> margaret with the margaret thatcher center foundation. from the statistical standpoint what would you say is the number one reason women would get for being conservative? >> the number one reason women get for being conservative this jury philosophical and not specific issue base, it is their view of government. is the believe government should do less and not more, that the government should do -- they are very constitutionalists in those ideas in other words when you listen to them talk, they speak about how if it's not prescribed to the government to do it in the government should not do it. the have a certain sense of
10:35 pm
federalism. they are scoring much higher on the six of the questions, about federalism or about what the supreme court does, the congress does, the congress is our so there's a certain nexus and i think that makes sense. it's got us to do with any one issue in a lot more to do with basic governing philosophy. and i think that's important because just as i was saying at the beginning of my talk liberals don't call themselves liberals and the more they call themselves progressives. remember, the only time that really we hear people mention conservative like the media cover people that the conservatives is when they can choose the proceeding adjective, right-wing, christian right, abortion opponents or anti-abortion conservatives or bush loving or tea party going. denney to choose the adjective because the need to defuse and dampen the potency of that word conservative because 40% of americans to consider themselves to be conservative. that's why many of the battles you see that we all see britain
10:36 pm
about are between democrats and republicans because the eckert is a stronger word than republican, but liberal is a much less strong a word than democrat because conservatives are a much more stronger word than republicans that is why you see it. and it's a view of the role of government, which is why it is so important to always talk about first things in that way. yes? >> my concern is the politics of urban areas especially the washington, d.c. area. we have a high amount of government workers that frankly just a lot of them got raises and so we have a couple things going on and one is the view they are going to profit from the continued growth of government and then there is the unemployment data that this spending is driving. have you done a poll, obviously we want to put food on our table, in most towns the largest employer is the government, the school system. >> i have seen polls like that. we've done them but not a long
10:37 pm
time so i wouldn't be able to give you a credible and recent results from my firm but i have seen polls like that of government employees and more and more they are restricted from participating in surveys. it's becoming more difficult to survey them from some outside of its. but you do see a difference. i think where the question is going to be the most important looking to 2010 and beyond is how the redistricting goes in the next, after the next census. this is why it's so important for us to run people for governor who take this seriously who say redistricting, not that, bringing the number geeks for that and being 1i can confidently say numbers and cheeks are good but it's such important issues and republicans have got at wrong. they don't take seriously lie in a large and some of the state's redistricting its win to be very important because the more you carve a district to be
10:38 pm
uncompetitive that's right and we have more now than ever. but also, very monochromatic in terms of the type of work so you're seeing government employee or monochromatic in terms of type of ideology. that is very disconcerting. so it's important. monitoring i would say keep an eye on is in a really good 2010 may be somebody like congressman jim moran in virginia's eighth district just over the bridge here to his voters are he has a lot of federal government employees in his district and may be wins the 2010 will get some like that to retire or have a close race if not be defeated and that is because issues outside of or above their employment or beyond just than protecting themselves with the most important in going to the ballot box but i think it's most important, the question you have as much report and try not to jobs and employment as you say, but also with redistricting.
10:39 pm
>> last question. >> it's yours. >> my name is kate right and i would like to ask a question in honor of clare boothe luce regarding media and entertainment. i saw an old episode of "friends" last night and it depicted a mind set an agenda more than storytelling and from your point of view, kellyanne, do you ever do polling regarding entertainment and media? if you do or have a sense of that, could you give a little direction of what might work for younger audiences to help them understand why clare boothe luce even existed in such high regard? >> it would be how to reach -- okay it's a great question and it's an important question given the diffusion of communication tools and media an alternative
10:40 pm
media as people move away from the three big networks by and large for the main sources and information as we become a much less verbal population and communication and do it all on the keyboard is seems now at the point and click the mouse and god forbid to countries are going to go to a war one day over a net e-mail and not actually declare war a. that is a very simplistic way of saying that young people want you to go where they are and that was part of my cash previous answer about the barack obama campaign he effectively using technology to go where young people are they are not going to come and find you, and where they are is a little bit under their radar screen that a little bit in places that you would already suspect. you could go and pull the nielsen ratings where people are watching tv and what they are watching by different age groups. but what is important about young people is the social
10:41 pm
networking tools should not be discounted as he ticked organizational and communication conduits' because they are ways not just to tell people what you're doing and what's going on in your life and update pictures of your weekend and what not, but really as sources of news and information for them, and just on the slightly different angle with respect to entertainment and media i would commend to everybody that phenomenal work than through blight or is doing, britebart.com. he's doing a great job pulling together the hypocrisy initialling the intersection between hollywood and washington and between hollywood and the political left to be he put together these great clips frankly of candidates nominee obama talking about negotiations in health care.
10:42 pm
so you go on britebart.com. that is a slightly different answer but it's important to understand knowing how young people use media what is actually going on in hollywood and in the media and that is where andrew is it's not like he's looking here out were, it's a very useful tool so we can just say young people, forget it, they are not going to get involved, they are apathetic, undereducated, it's unfair, they would get involved if they are asked and i think the last presidential election cycle proved that. but where are they now? back on the futon doing nothing to get -- i said that to laura ingram and she said no their back on their parents colleges, not even their own futon. [laughter] very funny but they are not there to help get this agenda passed by the president in this congress which is very telling so they are out there for other people to miss it and say now we need you where it counts, not just political campaigns and elections but to actually help
10:43 pm
policy whether to stop batt polis your help advance common sense policy and i think people don't look at young -- the old message young folks. people are involved, the choose where to live. they have much more flexible now in geographic choices and nimble, they choose where to live now whether to stay in that college town or move. a day before marriage and parenthood until later if all and so they are able to feel a bit more mobile in a little bit more flexible so they get more invested in a community early on and having chosen to live there and i would miss it to them from the bottom-up. thank you very much. [applause] >> with a great talker, kellyanne. i have to tell you of all the women we promote and send out to speak, i always tell them you are the most interesting to listen to. [laughter] it is absolutely true we have
10:44 pm
here a limited edition clare boothe luce policy institute coffee mug with her famous sitting "no good deed goes on none." [laughter] [applause] >> and from heritage lives like to hear you talk about conservative women and how principle oriented and the constitutionalists are. we all know that within the confines of this room and the women who watch on c-span but we have discreet but the will be a tool for all of you to share with those women saying why are you conservative. we hold these by matt spaulding and we've just come out with a study guide. it's not out yet. we will be doing that. so it will be a great tool for you to share with your reading groups and i know there's a lot of republican women here. i wanted to share that as a principled conservative women. and this terrific tv that heritage produced recently, "let me rise," about the school choice program in the district in jeopardy. the congress pulled the funding. next month's speaker is going to be virginia pulled in for the
10:45 pm
founder of the d.c. parents for school choice but this is an incredibly moving video. so i encourage you and for those watching to search on google, "let me rise," and it is the story of the d.c. school choice fight. you are conspiring to us and i know you can carry this message. >> thank you to read and i think you should transform this from a coffee mug to tea party mug. [applause] >> thank you for joining at the heritage foundation to the c-span audience, heritage.org will be archived on the web site and for those here today, we are going to lunch lacrosse alladi see you can ask kellyanne your questions.
10:46 pm
on today's washington journal wl steele about the 2010 elections and his new book is about 45 mi. >> host: michael steele, chairman of the republican
10:47 pm
national committee. and he's also the author of "right now it will step program for defeating the obama agenda." mr. steele, if we could start politically, if he were a betting man how many seats do you think that the gop will pick up or lose in the 2010 congressional election? >> guest: the challenge with that in january is that as we are beginning this primary process and getting ready for the elections there's still a number of important districts around the country where individuals are considering running for having folks in state legislatures deciding to go to congress so there's a lot of moving pieces so it's hard to say the with the trend is going it clearly abodes well for republicans in the house and the retirements, the fact i believe there may be a few more blogs to decide to come to the republican way. it's been to be hard to come back to the district's and argue
10:48 pm
for the spending and growth of government in district that have no toleration for it. and so i'm looking forward to some significant pickups. i don't what that is. i can't put a finger or number on it in january. but i think the work that the rnc and the national republican senatorial congressional committees have been doing is going to yield some really good results in november. >> host: are you going to have the money? >> guest: absolutely. and that's an interesting thing and one of those aspects of the past year hasn't gotten a lot of focus and attention but when you consider the fact we came to -- liking to this job in february 1st was my official day. we come off the wave of the election, obama is the president, they picked up 13 million donors through his network and the democrats are riding high, got the congress and all of that. and so over the course of the
10:49 pm
next year you're thinking we are the little engine that's just trying. in the course of that here we a pound of raising over $80 million. we beat the democrats in fund-raising on a number of reporting period and the end of the day i had 8 million, $9 million to carry into this year, no debt, and i feel very good about it. we spent $40 million in virginia, new jersey. we put $6 million into our state parties to begin to rebuild apparatus fifer operations on the ground and technologies that are going to be important this year. and i feel good about that. the budget i inherited his $0 the end of the year and debt. and that is an irresponsible way to run the committee and it wasn't fiscally prudent to and the year with no money and start january with nothing. so we did what we had to do to make sure we met our obligations to the campaigns. met our obligations to our state parties and had money in reserve
10:50 pm
to begin the new year and i feel good about where we are. >> host: in your book, "right now," you outlined in the 60's and republicans made particularly the of last eight years. >> guest: yeah and it gets important, the parties in the period of recovery and some people ought not to admit that. you say that wasn't our fault, that was somebody else. well, that isn't what a lot of folks in america are saying. i think the latest rossin poll had in terms of identification or popularity we were at 22%. you know, tea parties were like 35, democrats with 32 or something. so we clearly have a gap between the american people and the party. and i think it's the responsibility of the national chair and the chairs around the country to fix that and the way you begin to do it is to acknowledge this is where we've made mistakes when you grow government spending, against the principles that have been so important to define the party for generations. you walk away and create
10:51 pm
problems we saw in 2006 and in 2008 and losses at the polls and loss of confidence and loss of faith in the party. and i think now we have an opportunity once we acknowledge where we have gone wrong and stand firmly on our principles and lead into the future with some positive ideas and a new direction the american people will come to us and i feel we have seen that already in new jersey with the election of chris kristen and bob macdonald. host could you talk about the tea party groups in your book "right now." are they the future of the republican party? >> guest: they are the republican party. to the extent that they are part of the conservative network of activists, a lot of them, some of them are my friends or four more republicans. they are independent, they are formal, they identified one as reagan democrats. it is a cross section of america. our opportunities as a party right now is to open our arms and welcome people who want to be part of what we think is a
10:52 pm
principled leadership that takes america and helps us build infrastructure and in power people and engage in a different way than what we see happening right now in washington. so i reached out my hand as the national chair and say we are fighting the same cause. we are fighting about the same principles of free markets, free enterprise, lower taxes, competitive marketplace where america stands strong with its head looking to the future and not trying to tell a tale to those who do not have our best interest in mind, and i think with that kind of a message following it up with action where we follow-through and act on those kind of things and make sure we control the spending in washington that we will work its influence and businesses and daily lives, then i think we will turn a very important corner. >> host: is that -- part me -- part of the national platform you see the republicans running on? >> guest: i think that's part of it. and it really will come down to
10:53 pm
what the individual candidates are able to do in their neighborhoods and communities. how the translator message and their principles. you saw in virginia and new jersey chris christie and bob macdonald actively take the conservative principles that have defined them and their leadership and translate into the transportation policy and health care policy, economic policy and the people understood where they wanted to go and decided that was a better way to go and where we have been, and that type of relationship needs to be reestablished. new gingrich and dick army gave a contract with america and the understood what america was looking for at the moment and they were willing to put their name on the line on behalf of their party because those principles. what happened since then as we strayed away from that. b. straight away from the things we said we would do and now we can come back and that is what we are about doing. >> host: before we get to the calls, and the numbers are on the screen if you'd like to talk
10:54 pm
to the chairman of the committes from this morning's paper and give you the chance to respond. this is ralf, who has written now a couple of articles about you, about the republican national committee. i don't know whether you consider him a friend of yours. >> guest: no, not really. [laughter] >> host: steele tells gop critics to fire him or shop. >> guest: i can be a little bit of a hot hand. i'm very passionate about this job. i'm very passionate about this party. i grew up in this town. i made a conscious decision not 17-years-old to become a republican because i heard a man talk about an america that recognized my potential, and recognized what i could do as a black man in this city when i'm surrounded by democrats who were talking about a whole lot of other things that i could not connect to. programs come institutions. no one was talking to me about what individuals can do and how
10:55 pm
free it is to be the to access the american dream. my mother had a fifth grade education and worked in a laundromat in this town for 45 years before she retired making $3.83 per hour. but she understood why the american dream was denied to her. it would not be denied to her son. and so she created that pathway. and when i heard ronald reagan speak when he was running for president in 76, he sounded like my mother. he sounded like the things she was saying to me that i could do. and so that connected me to the party at that moment. and so here i am now, some 33 years later, sitting as the chairman of the republican national committee coming off of a devastating loss of which i was a part of in 2006 when i ran for the united states senate. and i feel passionately about moving this party for work. i like to turn -- quit turning the elephant and increasing this platform, largely created by barack obama who came on the
10:56 pm
scene and shook it up, and now the question is how does the party adapt to this environment? how do we reach out and touch this generation of the voters and told them that this party wants to and how were you cannot the institutions of government. this party wants to help you create a pathway so you have the relationship from the bottom-up and so i get a little hardheaded sometimes because i don't understand all of the malaise. and i know it is a part of the job. but i want us to focus on helping mitch mcconnell and john boehner in the congress pushed through the legislation we need to keep america going the right direction, not the wrong direction as we see on health care. and the folks on the grassroots fuel this party is going to be true to its principles and lead from those principles during this century. >> host: there was a new poll out singing who was the leader or the face of the republican party and john mccain came out on top. do you believe he's still the face of the party? >> guest: john mccain is one of many leaders in this party
10:57 pm
and i admire his run for the presidency because i remember that july when john mccain was up against the wall. i remember the july seeing john mccain at the airport in 2007 by himself catching a flight and no one paying attention to him and his determination and perseverance through that campaign to come out as the nominee is something i think a lot of people at buyer and should admire. he represents so much that this party has to offer along with, you know, mitt romney and sarah palin and governor pawlenty, governor general, my good friend, haley barbour. so we have the leadership that's out there and guess what's going to happen? over the course of this year and early next year and officials are going to begin to emerge who will contend for the presidency. who want to represent the principles of this party nationally for the presidency. and that is going to be an exciting to watch. we don't know who is goi be surprised that that leadership
10:58 pm
is there and that they are ready to get the job done. >> host: "washington post" this morning. phillips story steele's story is but congressional republicans on the hunt for a muscle is the headline. brad what house of the democratic national committee says that you are the gift that keeps on giving. >> guest: yeah, well you know, try to wrap the gifts. the reality is, this job is tough, important, but the more important thing that we do is we build the team, put their resources in place, run candidates and they reflect back to the american people the principles that define the party and if we do not do that it doesn't matter what michael steele says or congressional leaders say we will not garner back the support in the face of the american people. we will remain 22% or worse in the polls in terms of popularity or identification and we will
10:59 pm
have lost our way permanently and i don't believe that will happen and i certainly don't want to happen on my watch. i remain committed to getting out there and being on the streets. i've spent time in harlem and detroit and light on how tom hall's here at howard university. i've got around the country and have a conversation, and i try to reflect back to the hill what folks out here are saying. their frustrations. when people are told that they are on american because they disagree but with their government is doing, this party, the republican party is the party that will step in and say that is wrong. we know better how to lead. but we need to demonstrate that every single day because these people out here watching were ticked off and it doesn't happen. remember people used to say well, i don't know about your congressman, they need to get rid of him that mine, he's a good guy. you know what you're seeing right now? not only does your congressman stand but so does mine. and so they are looking at this seeing a pox on both your houses.

117 Views

info Stream Only

Uploaded by TV Archive on